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Inefficiency, Dry Powder and Deep Value

Stocks in this article: TECDBHEAOSLSTECSXCLESIO

Not surprisingly, there are a proportionately large number of other computer/semiconductor/ technology related companies that made the cut as well. These include Benchmark Electronics (BHE) -- which is frequently on several value-related screens, Alpha and Omega Semiconductor (AOSL), STEC (STEC), Steel Excel (SXCL), and Tellabs (TLAB).

Other qualifiers include mall retailers are West Marine (WMAR) and Systemax (SYX), and digital media name RealNetworks (RNWK).

Despite declaring a special $2 dividend, it appears as though Electro Scientific Industries (ESIO) would still qualify, even after backing out the dividend payment, and how it affects the balance sheet.

A couple of other names, Kelly Services (KELYA), which I am also seeing on several value related searches, and Tesco (TESO), were ever so close to qualifying, but upward movements in their stock prices this week, eliminated both, at least for the time being.

Buckle up today, it could get interesting.

At the time of publication the author held no positions in any of the stocks mentioned.

At the time of publication, Heller was long ESIO, although positions may change at any time.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Jonathan Heller, CFA, is president of KEJ Financial Advisors, his fee-only financial planning company. Jon spent 17 years at Bloomberg Financial Markets in various roles, from 1989 until 2005. He ran Bloomberg's Equity Fundamental Research Department from 1994 until 1998, when he assumed responsibility for Bloomberg's Equity Data Research Department. In 2001, he joined Bloomberg's Publishing group as senior markets editor and writer for Bloomberg Personal Finance Magazine, and an associate editor and contributor for Bloomberg Markets Magazine. In 2005, he joined SEI Investments as director of investment communications within SEI's Investment Management Unit.

Jon is also the founder of the Cheap Stocks Web site, a site dedicated to deep-value investing. He has an undergraduate degree from Grove City College and an MBA from Rider University, where he has also served on the adjunct faculty; he is also a CFA charter holder.

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