The February short interest in Yahoo! (YHOO) dropped 4.2 million shares to 79.9 million. Over the last year, the company’s shares are down about 5%, but have been moving up since late December.

Perhaps fewer investors want to bet against the success of Panama. Click rates on Yahoo! search-related ads have been moving up, a sign that the company may not be beaten to death by Google (GOOG). 

And, there is the ongoing rumor that Microsoft (MSFT) may try to buy Yahoo! to bolster its online presence. Stranger things have happened.

Douglas A. McIntyre