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A federal appeals court is reviewing the decision to let a group of smokers file a class action suit about whether "light" cigarettes where marketed as being safer than regular smokes.

While it is hard to determine what damages the suits could bring to tobacco companies if they were successful, the plantiffs claim that big tobacco brought in between $120 billion and $200 billion in "light" sales. Why their lawyers cannot get to a number in a slightly tighter range is hard to understand.

Shares in Altria, parent of the largest tobacco company Philip Morris rose almost $1.50 to just under $85 on the news.

As the litigation has favored Altria and its counterparts, the company’s stock has gone from $28 in May 2003 to the current level.

But, the "light" cigarette wrinkle is fairly new. Older suits were based on the simple premise that tobacco companies hid the risks of smoking and marketed products that they knew were dangerous. The treachery alleged here is a bit more subtle. And, perhaps more complex.

Altria is at a high, but the fat lady has not sung. There is still a far amount of risk.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Stocks: (GOOG)(YHOO)

As Yahoo!’s stock price sits new its 52-week low, the amount of speculation about the company’s future increases. Merrill Lynch recently raised its rating on the web company saying that the pullback in the stock price on poor Q3 earnings make the share cheap. Legg Mason has expressed its concern that Yahoo! has not been able to generate more revenue despite its total audience advantage over Google. But even Legg Mason thinks the big web company is worth more, putting its "intrinsic value" at the mid-$40 range.

But, value based on what. A lot of traffic that is poorly exploited? A management team that does not seem to have an articluated plan for improving operations? Recently, senior management at Yahoo! got a memo from one of its members saying the company was trying to do too much for too many web visitors and the the company needed to focus on fewer, better opportunities.

The New York Times has even mentioned that Yahoo! might be a takeover candidate. That would be true only if an acquirer believes that Yahoo! core problems can be solved. Most of what the company does is already duplicated at competing websites like AOL and MSN. Financial information, Video, Maps. E-mail. Instant messaging. Photo sharing. Classifieds.

Yahoo!’ facing a tough set of issues that revolve around the fact that its huge traffic still does not mean that its is differentiated in any critical way from its competitors, expect Google where revenue companies almost exclusively from text-based search ads.

If Yahoo! has another poor quarter, or if its ad revenue growth rate falls behind the industry, the stock price could drop below $20, with a risk of its dropping further.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.