Filed under: Deals, Microsoft (MSFT), Yahoo! (YHOO)

Short sellers must be betting that there won’t be any deal between Microsoft (NASDAQ: MSFT) and Yahoo! (NASDAQ: YHOO). That would leave Carl Icahn holding a lot of stock without a profit.

Short sellers reduced their position in Microsoft by 25 million shares as of May 15 compared with April 30. That brought the total short interest in the world’s largest software company down to 73.4 million.

Over at Yahoo!, short interest rose 9.3 million to 47.3 million. That was the largest increase for any company traded on Nasdaq during the May 15 period.

Short sellers might be admitting what Yahoo! shareholders can’t bring themselves to believe, at least not yet. With no bid from Microsoft likely, Yahoo! has no other buyers. The company can do tiny to keep its share price from drifting back to the $20 range, especially if its Q2 numbers are weak.

Icahn can win his board seats in a proxy fight against the portal company. He’ll not be able to do anything with his influence if he gets it. He can’t sell what no one wants.

Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 newsletter.

Read | Permalink | Email this | Linking Blogs | Comments

Share This

Share This

This entry was posted on Wednesday, May 28th, 2008 at 8:53 am and is filed under Latest News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.