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The Justice Department and most states suing Microsoft (MSFT) - Get Microsoft Corporation Report will urge a federal court today to split the company into two parts, The Wall Street Journal reported. According to the story, the government intends to ask the court to create rival companies, one built on Office applications software, and the other built on the flagship Windows operating software, the source of the company's monopoly power. Despite the latest news, a breakup is not imminent, the story says. Even if Judge Thomas Penfield Jackson accepted the proposal, an appeals process could take year or more.

Ericsson

(ERICY)

posted a hefty rise in first-quarter earnings and raised its financial targets for the rest of the year. Profit before financial items surged to $672 million, well above projected estimates. The company said it expected its powerful recovery to continue and increased its income growth forecast to more than 25% for the current year. Second-quarter sales were seen to be over 25% higher.

Mergers, acquisitions and joint ventures

Donaldson Lufkin & Jenrette

(DLJ)

announced that it plans to buy the money management arm of

First Dominion Capital

, a unit of energy company

Dominion Resources

(D) - Get Dominion Energy Inc Report

. Financial terms of the deal were not disclosed.

Finnish telecom equipment maker

Nokia

(NOK) - Get Nokia Oyj Report

announced a number of deals this morning, including an agreement with German

TheStreet Recommends

Viag

to supply radio access equipment and a deal to supply WAP gateway equipment to British

Norweb Telecom

. Nokia also announced an agreement to supply broadband Digital Subscriber Line systems to Dutch operator

KPN Telecom

(KPN)

and a wireless joint venture with Chinese software firm

Shenyang Neu-Alpine Software

.

Credit Suisse First Boston

raised Nokia's price target to 68.

British advertising conglomerate

WPP Group

(WPPGY)

is in talks to buy

Young & Rubicam

(YNR)

in New York, the

New York Times

reported. The deal would combine two of the world's largest advertising companies.

PaineWebber

(PWJ)

, the fourth-largest brokerage firm in the U.S., said it plans to buy privately held regional brokerage

J.C. Bradford

for about $620 million in cash. Nashville, Tenn.-based Bradford has 81 offices in 14 states and adds more than 900 financial advisors and $46 billion in client assets to PaineWebber.

PaineWebber is the subject of today's Heard on the Street column in the

Journal

. The column says the brokerage firm has undergone a subtle, but significant, shift with respect to the notion of a merger or a sale of the company. According to a securities analyst quoted in the story, this is the first time PaineWebber has set a time frame to start looking for strategic partners.

Casino mogul Steve Wynn has struck a deal to buy the Desert Inn Hotel and Casino in Las Vegas from

Starwood Hotels & Resorts

(HOT)

for about $270 million in cash. Wynn, 58, is set to leave his post at the helm of

Mirage Resorts

(MIR)

after the completion of the sale of Mirage to

MGM Grand

(MGG)

.

--

Eileen Kinsella

Earnings/revenue reports and previews

(

Earnings estimates from First Call/Thomson Financial, earnings reported on a diluted basis unless otherwise specified.

)

Starbucks

(SBUX) - Get Starbucks Corporation Report

lost its after-hours perk, despite reporting second-quarter earnings of 12 cents a share, in line with the 21-analyst estimate and up from the year-ago 10 cents. The coffee shop chain said same-store sales were up 10% over the year-ago period, while revenue came in at $505 million, up 34% from the year-ago $376 million. Starbucks also upped its fiscal 2000 domestic licensed store opening goal to 200 from 100, and upped its international target to 150 from 100.

Conseco

(CNC) - Get Centene Corporation Report

posted first-quarter earnings of 30 cents a share, including 13 cents related to the Tritel venture capital investment. The 10-analyst estimate was for 56 cents. Operating earnings in the year-ago period, excluding a gain on sale, were 54 cents. The company also announced that CEO Stephen Hilbert and CFO Rollin Dick have resigned. Conseco said the drop in earnings was partly due to a change in the way its loan unit, Conseco Finance, formerly Green Tree Financial, accounts for profits on securitized loans.

For more on this

story , see the coverage provided by

TheStreet.com/NYTimes.com

joint newsroom.

Electronic Data Systems

(EDS)

reported first-quarter earnings of 47 cents a share, in line with the 17-analyst estimate and up from the year-ago 36 cents. EDS said revenues in the first quarter increased 5% to $4.5 billion from the year-ago quarter. The company, which said it was comfortable with second-quarter and 2000 earnings estimates, attributed the strong earnings to successful restructuring in 1999 and its growing eSolutions unit.

Ericsson

(ERICY)

posted a hefty rise in first-quarter earnings and raised its financial targets for the rest of the year. Profit before financial items surged to $672 million, well above projected estimates. The company said it expected its powerful recovery to continue and increased its income growth forecast to more than 25% for the current year. Second-quarter sales were seen to be over 25% higher.

In related news, Ericsson announced it plans to reorganize its business into six separate units.

--

Eileen Kinsella

Offerings and stock actions

J.P. Morgan

said Pan-Asian Internet company

Chinadotcom

(CHINA)

will split its stock 2-for-1.

Analyst Actions

Merrill Lynch

analyst Jessica Reif-Cohen raised her rating on

Disney

(DIS) - Get Walt Disney Company Report

to long-term buy from long-term accumulate and set a target of 50. The near-term rating was kept at accumulate. The "increasingly positive outlook reflects Disney's accelerated turnaround and improved visibility in virtually all of its business segments, with the exception of consumer products," according to the report.

Upgrades

Powertel

(PTEL)

: UP to buy from neutral at

Lehman Brothers

.

Waters

(WAT) - Get Waters Corporation Report

: fiscal 2000 earnings estimate UP to $2.24 from $2.21 a share and fiscal 2001 estimate UP to $2.70 from $2.65 a share at

Deutsche Banc Alex. Brown

; fiscal 2000 estimates UP to $2.26 from $2.21 at

Warburg Dillon Read

.

WinStar Communications

(WCII)

: price target UP to 85 from 67 at

Salomon Smith Barney

.

Downgrades

American Eagle Outfitters

(AEOS)

: DOWN to buy from strong buy at DB Alex. Brown.

AT&T Canada

(ATTC)

: DOWN to intermediate accumulate from buy at

Merrill Lynch

.

Burlington Resources

(BR) - Get Broadridge Financial Solutions, Inc. Report

: DOWN to hold from buy at Lehman Brothers.

Polymer

(PGI)

: DOWN to an intermediate-term accumulate from buy at

Merrill Lynch

; second-quarter earnings estimates DOWN to 10 cents from 16 cents a share and fiscal 2000 estimate DOWN to 85 cents from 90 cents a share.

Sierra Health Services

(SIE)

: DOWN to market perform from buy.

Initiations

Cisco

(CSCO) - Get Cisco Systems, Inc. Report

: NEW buy at

ABN Amro

, price target: 85.

eMachines

(EEEE)

: NEW speculative buy at

Salomon Smith Barney

.

Mediaplex

(MPLX) - Get MPLX LP Report

: NEW buy at

Credit Suisse First Boston

; price target of 70.

--

Eileen Kinsella