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I would knock two off Tom's list of seven right off the bat.

1. DELL - a great company. It certainly has the best business model and execution among all its competitors. But all it has is execution - the best in a low margin business. This reminds me of Wal Mart which executes much better than Kmart or Sears, but it's still not the kind of business, fundamentally, that makes Cash Kings.

2. TLAB - The upcoming merger disqualifies it in my view. It makes the investment too speculative in the sense that no one knows the outcome. Just look at examples of mergers-of-equals in the same industry (different niches). Bay Networks (Synoptics+Wellfleet) and 3Com (+USRobotics) are prime examples why not to invest in mergers.

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