Marketing Pilgrim

Yahoo’s second largest stockholder sent a thinly veiled message to Yahoo this week, telling them that Yahoo’s better off independent if Microsoft lowers its offer. But what does their largest stockholder think?

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.

paidContent and CNET have all the boring facts: as of March 31, CWI owned 135.5M shares of Yahoo, or 10.1% of the company. That’s up 95% from their Q4 2007 stake.

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?