If we’re judging based on that, signs are looking good for the still-twisting-in-the-wind Yahoo: Capital World Investors nearly doubled its holdings in the company in Q1.
But I’m here to give you nice, juicy speculation (as long as I don’t pretend it’s a fact, right?). Join me, won’t you? Possible scenarios (with illustrative stock chart for your reference):
- CWI increased their stake right before Microsoft’s bid, when Yahoo’s stock was at the lowest point YTD (Jan 30-31), because they saw Yahoo as undervalued.
- CWI bought up new shares between the offer and the rejection (Feb 1-9), when stock prices skyrocketed. (And they continue to hold them because they have . . . sentimental value. Yeah.)
- CWI is holding nearly twice as much stock because they think that Yahoo should take the offer and want to have a controlling interest in the event of a hostile take over.
- CWI is holding nearly twice as much stock because they want Yahoo to remain independent and are trying to help them out with cash.
- Or is this just a move by Stacey’s sugar daddy, Carter Waltham III, to keep controlling her (and if it comes to a hostile takeover, he just wants to have the final say)?
Obviously, no matter what their timing and motivations, CWI rated Yahoo a buy last quarter. What do you think the most likely scenario is?