In the competitive spirit of college basketball's annual championship tournament, The Motley Fool brings you Stock Madness 2007! Our writers are making head-to-head arguments for their chosen stocks (but not necessarily investment recommendations -- this is, after all, a game), and you'll pick the winners with your article recommendations and Motley Fool CAPS ratings. Who will win the right to cut down the net? Let's tip things off and find out!

The matchup between networking firm Cisco (NASDAQ:CSCO) and computer-chip maker AMD (NYSE:AMD) would be a slam-dunk if it weren't for AMD trading near its 52-week lows. Cisco, on the other hand, has seen a nice run in its stock price, but I'm still a big fan, and I think it has a number of investment merits that set it apart from the competition -- both in its industry and against AMD.

A quick survey of the competitive landscape should quickly tell you how much of an uphill battle each firm faces in maintaining and growing market share going forward. Cisco's communications-equipment market is a bit more difficult to define, because it spans a wide array of applications, including wireless technologies, Internet applications, and networking gear for computers to talk among themselves and to the World Wide Web. Fortunately for Cisco, few competitors can match its scale and market clout; only lowly 3Com (NASDAQ:COMS), Foundry Networks (NASDAQ:FDRY), and Juniper come to mind, and Cisco is about 10 times as large as those three combined. Nortel (NYSE:NT) and Alcatel Lucent (NYSE:ALU) can also be considered foes, but we all know they are shadows of their former highflying selves since the dot-com bubble burst nearly five years ago.

In short, Cisco dominates its industry and has little in the way of a peer to threaten its bright growth outlook and impressive annual cash-generation capabilities. It even continues to gain share in a number of existing markets and successfully integrate acquisitions to keep growth chugging along. Plus, its markets are getting bigger as companies increasingly need servers and related Internet plumbing to support the massive amounts of data that are being created, stored, and retrieved in cyberspace.

In AMD's case, it must compete with a firm 10 times its size and enough marketing muscle, market-share dominance, and cash-generating capabilities to qualify it as a coveted Rule Maker. It's also selling cheaply enough to be an Inside Value recommendation, and it's one of the most successful companies of the past 20 years. That firm would be mighty Intel (NYSE:INTC). Lately, AMD has been able to develop a number of chips that match or exceed Intel's technological prowess, but I would still characterize AMD as a nuisance to Intel rather than a serious threat to unseat it as the 800-pound gorilla in microchip land. Another problem is that the two are fighting harder for existing market share because the growth rate for computers and related chips is stagnating after years of rapid expansion.

My counterpart in this matchup, fellow Fool Anders Bylund, will undoubtedly weigh in with his positive take on AMD, which, at its current price, factors in a lot of the competitive threats to its business model. But in the longer term, I don't think you can argue with choosing a company that completely dominates the routing and switching markets it competes in.

In my mind, the contest would be a more even match if we pitted Cisco against Intel, but as we all know, the seedings during March Madness can seem downright unfair at times. After all, a No. 1 seed has never lost to a No. 16 seed. And while I can't say with certainty that AMD qualifies for the lowest seed in the tourney, its bracket positioning does little to help it stand a chance of stacking up favorably against Cisco.

Does Cisco deserve to move on to the next round? If you think so, simply follow this link and rank the stock "outperform" in Motley Fool CAPS. If not, vote it "underperform" and go with AMD. Later this week, we'll tally your votes to determine which stocks will advance one step closer to the title.

Click AMD for the opposing article in this contest.

Click here for all of the other entries in the tourney.

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Fool contributor Ryan Fuhrmann is long shares of Cisco and is still sitting on major losses in Alcatel Lucent. Foundry, as a sale, would net him maybe a can of Coke. Feel free to email him with feedback or to discuss any companies mentioned further. He has no financial interest in any other company mentioned. The Fool has an ironclad disclosure policy.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.