US HOT STOCKS TO WATCH: International Paper, Dean Foods

Among the companies whose shares are expected to see active trading in
Wednesday’s session are Deere & Co. (DE), Yahoo Inc. (YHOO) and Freddie Mac
(FRE).

Deere & Co. (DE) posted a 22% rise in fiscal second-quarter net income, but said
escalating raw-material costs will affect operations for the rest of the year,
resulting in the company projecting fiscal third-quarter net income below
analysts’ expectations. Deere reaffirmed its February forecast for fiscal 2008
net income of about $2.2 billion but projected third-quarter net income of $550
million to $575 million. Analysts’ expectations were $2.27 billion and $650
million, respectively.

Billionaire investor Carl Icahn has purchased roughly 50 million Yahoo Inc.
(YHOO) shares since Microsoft Corp. (MSFT) withdrew its offer to buy the Web
company, and is leaning toward launching a proxy contest to unseat at least part
of Yahoo’s board, reported The Wall Street Journal, citing a person familiar with
the situation. Icahn is expected to decide Wednesday whether to launch a proxy
contest. A Yahoo deadline for board nominations looms Thursday. He currently has
no assurances from Microsoft that it would reconsider a Yahoo purchase, according
to the person.

Freddie Mac (FRE) reported a narrowed first-quarter loss, reflecting
guarantee-valuation-methodology and accounting changes that resulted in reduced
losses and lower interest-rate-related mark-to-market losses, as the agency
announced plans to raise $5.5 billion in new core capital. The
government-chartered loan clearinghouse posted a net loss of $151 million, or 66
cents a share. Revenue more than doubled to $1.53 billion from $694 million,
driven by growth in the company’s guarantee business.

American International Group Inc. (AIG) is planning a two-part, junior
subordinated bond issue, denominated in euros and sterling, one of the banks
managing the deal said Wednesday. Citi and JPMorgan have been mandated as
structuring advisors and “active book runners” for the transaction. Both tranches
of the deal have a final maturity of 60 years and scheduled maturity of 30 years.
The bonds are non-callable for 10 years.

ArcelorMittal SA (MT) said Wednesday that net profit in the first quarter of this
year climbed 5.4% year-on-year, led by higher steel production and prices.
ArcelorMittal posted a net profit of $2.37 billion in the three months to March
31. The figure missed market expectations of $2.55 billion. The company’s
earnings before interest, taxes, depreciation and amortization rose to $5.04
billion from $4.35 billion in the same period of 2007. This figure was slightly
ahead of analysts’ average forecast of $4.94 billion.

Sony Corp. (SNE) swung to a profit in the fourth quarter as losses from the
PlayStation videogame business shrunk significantly and it said it expected both
videogames and televisions to become profitable this year. For the fourth quarter
ended March 31, Sony reported a profit of Y29.04 billion ($290 million) compared
with a loss of Y67.56 billion a year earlier. Quarterly sales fell 6.5% to Y1.95
trillion.

General Motors Corp. (GM) is forecast to report a first-quarter loss of $1.57 a
share, according to analysts polled by Thomson Reuters.

Starbucks Corp. (SBUX) is expected to report earnings of 21 cents a share in the
second quarter, according to analysts polled by Thomson Reuters.

Time Warner Inc. (TWX) is expected to post earnings of 23 cents a share in the
first quarter, according to analysts surveyed by FactSet Research.

Procter & Gamble Co. (PG) is likely to post third-quarter earnings of 81 cents a
share, according to analysts surveyed by FactSet Research.

Kraft Foods Inc. (KFT) is projected to post earnings of 40 cents a share in the
first quarter, according to analysts surveyed by FactSet Research.

Ingersoll-Rand Co. Ltd. (IR) is forecast to report earnings of 71 cents a share
in the first quarter, according to analysts surveyed by FactSet Research.

Prudential Financial Inc. (PRU) is expected to report first-quarter earnings of
$1.83 a share, according to analysts surveyed by FactSet Research.

Colgate-Palmolive Co. (CL) is estimated to post earnings of 89 cents a share in
the first quarter, according to analysts surveyed by FactSet Research.

Kellogg Co. (K) is projected to post earnings of 76 cents a share in the first
quarter, according to analysts surveyed by FactSet Research.

Reynolds American Inc. (RAI) is likely to post earnings of $1.15 a share in the
first quarter, according to analysts surveyed by FactSet Research.

Symantec Corp. (SYMC) is projected to report fourth-quarter earnings of 32 cents
a share, according to analysts surveyed by FactSet Research.

OfficeMax Inc. (OMX) is expected to report earnings of 68 cents a share in the
first quarter, according to analysts polled by Thomson Reuters.

IAC/InterActiveCorp (IACI) is likely to post earnings of 28 cents a share in the
first quarter, according to analysts surveyed by FactSet Research.

AvalonBay Communities Inc. (AVB) is forecast to post earnings of $1.22 a share in
the first quarter, according to analysts polled by Thomson Reuters.

DTE Energy Co. (DTE) is expected to post first-quarter earnings of 75 cents a
share, according to analysts surveyed by FactSet Research.

International Paper Co. (IP) is estimated to report first-quarter earnings of 51
cents a share, according to analysts surveyed by FactSet Research.

Dean Foods Co. (DF) is predicted to report earnings of 18 cents a share in the
first quarter, according to analysts surveyed by FactSet Research.

After Tuesday’s closing bell, Citigroup Inc. (C) commenced an offering of about
$3 billion in common stock and will include an over-allotment option to purchase
additional shares. “We are issuing common equity at this time as we continue to
optimize our capital structure,” said Gary Crittenden, chief financial officer.

Watch List

3Com Corp. (COMS) named Robert Mao as chief executive to succeed Edgar Masri, who
is leaving the company. “To support the company’s increasing emphasis on its
growing and profitable China-based H3C operations, Mao will be based in China,”
said the company in a statement. The converged voice and data networking
solutions company also hired Ronald Sege as president and chief operating
officer, effective April 30.

ACE Ltd.’s (ACE) first-quarter net income fell 46% to $377 million from a year
earlier when the insurance and reinsurance company made $701 million. Net income
was $1.10 a share after payment of preferred dividends, down from $2.10 a share
for the same quarter last year, the company reported. Excluding net realized
gains and losses, ACE said it made $2.16 a share in the latest period. The
company was expected to make $1.91 a share, according to a FactSet analyst
survey.

CB Richard Ellis Group Inc. (CBG) reported its first-quarter earnings rose to
$20.5 million, or 10 cents a share. Excluding one-time charges, the Los Angeles
real estate service company would have earned $31.7 million, or 15 cents a share.
Revenue increased to $1.23 billion. Analysts had projected earnings of 24 cents a
share on revenue of $1.16 billion.

DreamWorks Animation SKG Inc.’s (DWA) first-quarter profit rose to $26.1 million,
or 28 cents a share. Results in the latest quarter included a tax benefit of 2
cents a share. Revenue rose 68% to $156.6 million. Analysts polled by Thomson
Financial were expecting a profit of 23 cents a share on revenue of $126.5
million.

Embarq Corp. (EQ) reported first-quarter earnings of $212 million, or $1.38 a
share. Revenue slipped nearly 1% to $1.57 billion. Analysts were expecting
earnings of $1.17 a share on revenue of $1.56 billion, according to average
estimates from FactSet Research.

Express Scripts Inc.’s (ESRX) first-quarter profit rose to $177.2 million, or 69
cents a share. Revenue rose to $4.6 billion. Analysts surveyed by FactSet
Research estimated a quarterly profit of 67 cents a share on revenue of $4.78
billion.

Flextronics International Ltd. (FLEX) reported a fiscal fourth-quarter loss of
$93 million, or 11 cents a share, compared with $121 million, or 20 cents a
share, a year earlier. Revenue rose to $7.78 billion. The results were affected
by restructuring and stock-based compensation charges. Excluding those one-time
items, Flextronics would have earned $215 million, or 22 cents a share. Analysts
had forecast Flextronics to earn 22 cents a share on revenue of $7.78 billion.

Harris Corp. (HRS) reported its third-quarter net income fell to $108 million, or
78 cents a share. Excluding acquisition-related costs and gains, the
communications products company would have earned 81 cents a share. Revenue
increased to $1.33 billion. Analysts surveyed predicted earnings of 75 cents on
revenue of $1.33 billion.

Lincoln National Corp.’s (LNC) first-quarter net income fell to $289 million, or
$1.11 a share. Operating earnings, which exclude net realized investment gains
and losses and other items, were $333 million, or $1.28 a share, the company
reported. Lincoln National was expected to make $1.32 a share, according to a
FactSet analyst survey.

Macrovision Corp.’s (MVSN) shareholders approved issuing stock to finalize the
proposed buyout of Gemstar-TV Guide (GMST). Shareholders of Gemstar-TV Guide also
approved the sale of the company to Macrovision at a special meeting. To complete
the deal, Macrovision and its successor entity, Macrovision Solutions Corp.
(MVSND), secured debt financing worth about $650 million.

National Semiconductor Corp. (NSM) plans to eliminate 130 positions, mainly in
its product line and support functions, and will book a fiscal fourth-quarter
charge of $10 million for severance and factory modernization. The semiconductor
products maker said the job cuts are part of a strategic alignment of its
resources, which is part of its “focus on accelerating revenue growth in key
markets.”

Moody’s Investors Service upgraded Nike Inc.’s (NKE) senior unsecured rating to
A1 from A2. “The rating upgrade reflects Nike’s continued growth, across product
lines and geographies, while maintaining gross and operating margins,” said Scott
Tuhy, a senior analyst at Moody’s.

TECO Energy Inc. (TE), parent of Florida utility Tampa Electric, reported its
first-quarter net income fell to $30.8 million, or 15 cents a share. Excluding
one-time items, earnings from ongoing operations were $31.4 million. Revenue fell
to $791.7 million. Analysts predicted the company would earn 22 cents a share on
$838 million in revenue.

Wells Fargo & Co. (WFC) will pay a quarterly dividend of 31 cents. The dividend
is payable June 1 to shareholders of record as of May 9. The company has about
3.3 billion shares outstanding.

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