First Albany upgraded Yahoo! (YHOO

) to buy from neutral.

Analyst Youssef Squall says he upgrades on the recent stock pullback and increased revenue and EPS estimates for 2004. He says this is driven by positive on-line advertising trends, strong subscriber growth at the SBC and BT broadband services. He thinks relatively weak comps (with first quarter 2003) and less pronounced seasonality can drive year-over-year growth in branded advertising by over 25%.

Squall notes that SBC Yahoo! and BT Yahoo! is gaining traction, evident in SBC's (SBC

) guidance to add more than 1.5 million lines in the next 12 months and BT's reaching 2 million broadband subscribers in February, 2004 - 10 months ahead of schedule.

Squall raised his 56 cents 2004 EPS estimate to 57 cents, and his $47 price target to $48.