Shorts yet to coverThe short position has actually increased slighly recently.
There may be two reasons for this.
The first is that the Trader sale was supposed to close this month , but has yet to close.
The shorts may have discovered that it may not close.
Secondly, and related to the Trader sale, the market is pricing in a huge drop in the dividend, if not altogether.
If the Trader sale falls through, YLO will almost certainly have to cut the dividend either to a few pennies or ( more likley ) altogether.
Afterall, their YP business is dying a slow death and they would be much better off using the cash flows to advance their other business focus and paying down debt.
The shorts are aware of this and wont cover until either the Trader deal closes and /or they announce that the dividend will dissapear in 2012.
My advice here is to wait for the Trader deal to go through.
In the meantime, the share price will continue to slide which will provide a better entry point and clarify the dividend status for 2012.
In any event, at 7.5 times fully diluted earnings, the fair value of YLO is less than $2.50 and that may be topside for a while until their digital business can take up the slack.