DJ US HOT STOCKS TO WATCH: Blockbuster, Circuit City, Yahoo

Wed. July 02, 2008; Posted: 07:50 AM

Among the companies whose shares are expected to see active trading in Wednesday's session are Blockbuster Inc. (BBI), Circuit City Stores Inc. (CC) and Yahoo Inc. (YHOO).

Blockbuster was up 13% in premarket trading after abandoning its efforts to acquire Circuit City for more than $1 billion. The video-rental chain's move to withdraw its bid leaves Circuit City, which was down 7.8%, scrambling to ensure its future.

Microsoft Corp. (MSFT), positioning itself for a new run for Yahoo's search business, has approached other media companies in recent days about joining it in a deal that would effectively lead to Yahoo's breakup, people familiar with the discussions told The Wall Street Journal. In premarket trading, Yahoo was up 5%, while Microsoft added 2 cents.

Starbucks Corp. (SBUX) was up 6.7% premarket as it disclosed plans to close an additional 500 U.S. stores and cut 7% of its work force - its most significant pullback yet to its U.S. expansion.

A federal court backed AstraZeneca PLC (AZN) in a patent lawsuit over its antipsychotic drug Seroquel, removing the threat of U.S. generic competition for the drug. Generic drug maker Teva Pharmaceutical Industries Ltd. (TEVA) and Sandoz, the generics unit of Novartis AG (NVS), had planned to make cheaper copies of the drug. AstraZeneca was up 2.8% in premarket trading, while Teva and Novartis were inactive.

UnitedHealth Group Inc. (UNH) was up 1% premarket after the managed-care provider said it has agreed to pay $912 million to settle two class-action lawsuits regarding its stock-options practices. The company again lowered its 2008 profit target and projected second-quarter earnings below expectations.

Dish Network Corp. (DISH) was down 3% in late-hours trading after it said AT&T Inc. (T) had provided it with notice the phone giant will terminate its agreement to resell Dish's services.

Shares in Germany's Deutsche Bank (DB) rose 4.2% premarket after the company said it does not expect its second-quarter results to necessitate a capital raising and projected a profit for the period.

Apollo Group Inc.'s (APOL) jumped 17% in after-hours trading after the for-profit education provider reported higher-than-expected results in its fiscal third quarter and said it would buy back another $500 million in stock.

Watch List

Lithia Motors Inc. (LAD) withdrew its second-quarter and full-year earnings guidance, citing weak June auto sales. Lithia said it's moving forward with a plan announced last month to adjust its inventory to carry smaller, more fuel-efficient vehicles and to divest at least 9% of its 110 stores, cut jobs and consolidate offices.

-By Dow Jones Newswires; write to hotstocks@dowjones.com

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(END) Dow Jones Newswires

07-02-08 0750ET

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