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Hot Stocks: Apple, DreamWorks Among Big Movers

Earnings news and analyst revisions were some of the catalysts behind the most actively traded stocks on Wednesday.

Apple shares rose on heavy trading volume after Citigroup upgraded the stock to "buy" from "hold" in the wake of Tuesday's strong decline in the stock, triggered by speculation regarding iPod production delays.

"Our fiscal 2008 free cash flow-per-share estimate of $5 suggests a worst-case downside to $115, but if the shares were to retrace to this level, we would simply buy more shares," said analyst Yeechang Lee. "We view a move to $160 as much more likely over 12 months than a move to $115, suggesting favorable risk/reward."

Shares of DreamWorks Animation advanced, following the animated film company's strong quarterly earnings, which were fueled by the box office success of "Shrek the Third." DreamWorks reported adjusted second-quarter earnings of 45 cents per share, compared with the Wall Street consensus of 31 cents.

Goldman Sachs analyst Anthony Noto raised the 2007 earnings estimate, and said consensus forecasts remain too low.

"We continue to believe that DreamWork's 2007-08 film slate should increase the view of normalized earnings ... and hence valuation to drive the stock," the analyst wrote in a client report. "We advise investors to buy DreamWorks with 20% upside to our $37 price target, which we view as conservative."

OfficeMax reported better-than-expected earnings for the second quarter, sending shares up on Wednesday. The office supplies retailer, which beat quarterly earnings estimates by 3 cents per share, said strong retail sales and improved margins contributed to the windfall.

Navteq moved higher amid above-average volume, after the digital map provider posted quarterly earnings that beat analysts' estimates and raised its 2007 outlook, due in part to stronger demand for maps used in portable devices.

On the downside, homebuilder stocks saw notable weakness on Wednesday, led by a sharp drop in shares of Beazer Homes.

Peter Kang is a markets writer at CNBC.com and can be reached at peter.kang@nbcuni.com.

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