January 2026 proved that the activist short-selling community hasn't lost its bite. With 15 published reports and an 80% success rate, the month delivered a decisive mandate: well-researched campaigns still move markets. The average impact of −3.28% may appear modest at first glance, but that figure obscures a powerful dispersion story. At one end, Fugazi Research demolished SIDU with a −30.69% hit, while Pelican Way's campaign against ONMD carved out −23.42%. At the other extreme, Utopia Capital's call on NBY misfired spectacularly with a +71.72% rebound - a reminder that even in a month of strong conviction, the market reserves the right to disagree violently. With 53% of targets falling more than 5% and 40% dropping over 10%, January set a sharp tone for the year ahead.

Fugazi Research continues its scorching streak - now three consecutive months as the most impactful campaign of the month. Their SIDU report didn't just land, it cratered the stock by nearly a third. Gotham City's CVNA takedown also stands out: pushing an $88 billion name down 15% in just two days shows these campaigns can rattle even the largest targets when the thesis is airtight.

NBY's +71.72% surge is January's cautionary tale. Utopia Capital's thesis may have had merit, but the biotech sector is notorious for ignoring fundamentals in favor of catalyst-driven momentum. SHORTFINDER's SOC call and Hunterbrook's UI report also moved the wrong way, though with far less severity. Only three of fifteen reports ended in negative territory for shorts - a strong overall hit rate, but that NBY whiplash is a painful reminder of what happens when a crowded short meets a squeeze.

NASDAQ-listed targets dominated the month with 8 reports and a punishing −13.48% average impact, driven by the SIDU, ONMD, and AFRM takedowns. NYSE names absorbed 5 campaigns but with milder results at −1.93%. The lone AMEX entry - NBY - single-handedly skewed its exchange category with that +71.72% backfire. Geographically, the U.S. remains the primary hunting ground at 73% of all reports, though WolfPack Research's move into JPX shows the activist lens is widening internationally.

Software led in volume with three reports, posting a respectable −5.50% average driven largely by Capitalwatch's APP campaign. But the real damage was concentrated in smaller sectors: Aerospace & Defense (SIDU at −30.69%) and Medical-Healthcare (ONMD at −23.42%) both delivered outsized moves from single campaigns. Biotechnology was the month's only true disaster sector, entirely due to NBY's massive short squeeze.

Micro-caps remain the sweet spot for activist shorts. With only two reports, the category delivered a devastating −27.06% average impact - SIDU and ONMD both belong here and both got crushed. Large-caps surprised to the upside (for shorts) with −8.60%, headlined by the CVNA and APP takedowns proving that even mega-caps aren't safe from well-timed research. The small-cap bucket was dragged into the red entirely by NBY's +71.72% squeeze, masking otherwise solid performance from the other four names in that range.

Gotham City Research's report on Carvana (CVNA) deserves more than a line in a table. Publishing a short thesis on an S&P 500 constituent with an $88 billion market cap is one of the most daunting undertakings in activist research. The scrutiny is intense, the legal exposure is real, and the institutional ownership base creates a wall of resistance that most short sellers never attempt to breach. Gotham didn't flinch. Their report triggered a −15.39% decline in just two trading sessions, erasing over $13 billion in market value and reigniting a conversation about Carvana's fundamentals that many had considered settled.

The significance of this campaign extends beyond the immediate price move. It takes a rare combination of deep forensic due diligence, conviction, and institutional-grade research methodology to move a name this large. The backlash from Carvana and its supporters was swift and aggressive, which only underscored how threatening the findings were perceived to be. When a company responds with fury rather than facts, the market tends to notice.

This isn't the first time Carvana has drawn scrutiny from activist researchers. Back in June 2025, we published our own deep dive into the subprime loan concerns surrounding the company, exploring what happens when short sellers are right on the thesis but early on the timing. With Gotham City's January report adding fresh ammunition, we are working on an updated analysis that incorporates the latest research and market developments. Stay tuned.

Activ8 Insights - Published June 2025

Carvana: When Activist Short Sellers Are Right But Early - The Subprime Loan Ticking Time Bomb

We first examined Carvana's subprime exposure in June 2025. An updated analysis incorporating Gotham City's findings is coming soon.