LONDON (MarketWatch) -- Citigroup cut video rental chain Blockbuster to hold from buy, saying that while it continues to expect strong 2007 results, driven by continued operational improvement, it believes most of these catalysts are well known and priced into the text as represented by the recent 50% climb in the shares since mid-August.

To be honest with you, I can't see how the stock has climbed 50%, other than the fact that 50% of $5.39 isn't a large number. I realize that they have been trying to really move to the online movie rental to try and take market share back from Netflix, but their brick and mortar stores are just not cutting it anymore. There are too many expenses to keep many of them open. I am not sure where the online movie rental industry will go, but I think it might have more of a chance than the traditional store fronts.