With its earnings due on the 29th, the debate over Yahoo (NSDQ: YHOO) is heating up. On Friday, analyst Jeff Lindsay put out a negative note on the stock, arguing that management was failing to take the needed drastic measures to turn the company around. Instead, he argued, the moves have all been geared towards incremental improvements that don’t address the big issues. Defending the company (at its current depressed levels) is JP Morgan analyst Imran Khan, who sees firming ad demand, growth in search and an opportunity to expand its partnership with the newspapers:

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—Advertising: Khan believes the company will benefit from a shortage of TV ad inventory, caused by heavy political spending and the writer’s strike. Khan made the same point in a recent report, that increased ad demand would push up CPMs, benefiting the likes of Yahoo and others.

—Search: How Yahoo is performing on search depends on what numbers you use. Khan sees 23 percent search revenue growth in ‘08, based on the Panama rollout and attendant revenue per search gains. Linsay’s report last week acknowledged the gains in search, but noted that they came amid a decline in search market share—thus his key assertion that Yahoo is making improvements at the margins, like Panama, but not doing anything to really turn the tide.

—Partnerships: So far, Yahoo’s partnerships hasn’t had much of a financial impact, according to Khan. But, he believes that the arrangement, which is currently focused on classified ads, could be expanded to display advertising, which could begin to drive some revenue. Khan puts the incremental revenue gain from the company’s various partnerships at $80 million per year.

—Bottom line: This isn’t a terribly bullish report. Khan concurs with Lindsay that the only good things going for the company are at the margins. But with Yahoo’s stock trading near its 52-week lows, he believes that these tailwinds should provide a bit of a boost.