From Barrons 2-5-07: Q: Why is NutriSystem (NTRI) your top holding? A: I think their main growth driver that we see in 2007 continues to be the expansion of the men's line. They do a lot of advertising with ex-athletes, especially football players, drawing in men. Then they are also introducing this year the senior's program. Most of the advertising and programs, from Weight Watchers to Jenny Craig and so, have been more geared to the female side. I clearly found the product worked for me as much as it worked for our portfolio. We think they have done it well for our holding period, which has been the last couple of years, and continues to be something that is going to gain even more market share."

From Barrons 2-5-07: "One of our names that we think is good is a company called Ansys (ticker: ANSS). The company, [which makes simulation software used by engineers and designers,] has been a good story for a number of years, and they continue to expand their product family. Once they get involved with a firm, they tend to be able to drive other products off of those same relationships. They have a very diversified list of top-end clients [numbering more than 10,000], such as General Electric, Nokia, and Boeing. It doesn't matter whether they have a slice of that pie which is undergoing a downturn in the economy, whether it is autos this year, aerospace is obviously very strong."

From Barrons 2-5-07: "We think that the aerospace cycle is just really in its early legs. [BE Aerospace] does have a more cyclical risk in it because it sells into the airline industry, and you have to have good profits for the airlines and you have to have airlines that want to expand. I think, obviously, that cycle has been going on -- part of it is to be more fuel efficient for the overall airline industry and part of it is the lower cost of energy and airlines are flying full again. A lot of [the company's] business is coming from overseas airlines looking to retrofit their cabins; so we think the U.S. demand for the aerospace products is still coming."

From Barrons 2-5-07: "Crocs (CROX) just continues to be very effective in opening up new doors and getting their footwear out there whether you are a student or whether you want Disney-type logos. If they continue to be a very smart management team, which we think they are, they will continue to keep the [product] lines fresh and keep the excitement around the name."

From Barrons 2-5-07: "Iconix Brand Group (ICON) is probably not that well known in the marketplace, but it continues to do well. It's a company that keeps being fresh by getting brand names, like Joe Boxer and Candies, and licensing them out. We think the management has done a very good job and again, from a market-share perspective, they continue to drive this company forward. London Fog was one that they've done in the last 12 months or so."

From Barrons 2-5-07: Q: What are the standout (banking) names? A: Prosperity Bancshares (PRSP) out of Houston reported [last] week. They actually increased their net interest margin and that is strongly different than the trend that is out there in the industry. So we think that was absolutely a stellar performance, and it's clearly what we are looking for and that's probably our largest holdings in the banks.

From Barrons 2-5-07: Q: What about health care? A: Probably our largest holding in the health-care side would be Psychiatric Solutions (PSYS). It owns and operates mostly stand-alone but also is in hospital psychiatric units. It is a very good operator that has been able to do a lot of acquisitions in the last couple of years. We still believe there are a lot of units that they can acquire across the nation. So they're an organic-growth play as well as an acquisition play. And they have been able to demonstrate in the industry that they are great acquirers and then great integrators of these units that they continue to add. We are backing the management team here very strongly.

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