July 2025 Activist Short Selling Recap
July 2025 delivered devastating results for targeted companies with 14 activist short reports generating an average -19.16% decline, led by The Bear Cave's spectacular 97.2% takedown of Pheton Holdings to claim our inaugural "Short King of the Month" title.
Activ8 Newsroom • August 12, 2025
Activist Short Selling Report
July 2025
Executive Summary
July 2025 delivered a tale of extremes in the activist short selling landscape. From The Bear Cave's devastating 97% takedown of Chinese tech company Pheton Holdings to multiple reports that backfired spectacularly (with targets rallying double digits), this month showcased both the power and peril of activist research. With 13 reports published and a 62% success rate, July's results fell slightly short of historical norms, as several high-profile targets defied short theses and surged higher. The month's -17.97% average impact was driven primarily by a handful of catastrophic collapses, while nearly 40% of all reports saw their targets appreciate in value.
The standout narrative: micro-cap manipulation accusations dominated, with allegations of fraud, accounting irregularities, and promotional schemes targeting small-cap tech and healthcare companies. Yet market reception proved selective. Investors embraced fraud allegations against Chinese-listed names while dismissing similar claims against U.S. infrastructure and land companies.
🎯 Top Performers
Most Impactful Reports
📊 Market Breakdown
📈 NASDAQ
9 reports (69% of total)
Avg. Impact: -18.49%
The dominant exchange for short targets, featuring tech, healthcare, and fintech names. NASDAQ-listed companies faced the harshest selling pressure this month.
📈 NYSE
3 reports (23% of total)
Avg. Impact: +1.41%
The NYSE Paradox continues. Reports targeting NYSE-listed companies actually saw targets rally on average, with land/energy names proving particularly resilient.
📈 NYSE American (AMEX)
1 report (8% of total)
Avg. Impact: -71.37%
Fugazi's BitMine report dominated this smaller exchange with a spectacular collapse.
🌍 Geographic Distribution
🇺🇸 United States (11 reports)
Average Impact: -13.35%
From healthcare fraud (Nutex) to fintech promotion (Aether) to e-commerce struggles (Groupon), U.S. targets covered a wide spectrum. Success was mixed, with small-cap promotional names suffering while established large-caps weathered the attacks.
🇨🇳 China (2 reports)
Average Impact: -43.36%
Chinese-listed companies were devastated, with both Pheton Holdings and Pony AI facing serious allegations. The market's willingness to believe fraud claims against Chinese companies remains strong, regardless of thesis quality.
🏭 Industry Breakdown
| Industry/Sector | Reports | Avg. Impact | Key Targets |
|---|---|---|---|
| Medical - Devices High Risk | 1 | -97.15% | Pheton Holdings (PTHL) |
| Financial - Capital Markets High Risk | 1 | -71.37% | BitMine (BMNR) |
| Software - Application Medium Risk | 1 | -31.82% | Aether Holdings (ATHR) |
| Medical - Healthcare Information Services Medium Risk | 1 | -23.54% | Nutex Health (NUTX) |
| Electrical Equipment & Parts | 1 | -18.01% | Flux Power Holdings (FLUX) |
| Industrial - Machinery | 1 | -11.84% | Enovis (ENOV) |
| Internet Content & Information | 1 | -9.69% | Groupon (GRPN) |
| Biotechnology | 1 | -8.19% | United Therapeutics (UTHR) |
| Conglomerates Defensive | 1 | +0.16% | FTAI Infrastructure (FIP) |
| Oil & Gas Defensive | 1 | +4.49% | Texas Pacific Land (TPL) |
| Information Technology Services | 1 | +10.44% | Pony AI (PONY) |
| Engineering & Construction | 1 | +11.37% | Limbach Holdings (LMB) |
| Oil & Gas Equipment & Services Defensive | 1 | +11.57% | LandBridge (LB) |
The pattern is clear: investors are increasingly skeptical of promotional micro-cap tech/crypto names with governance red flags, but they're willing to give established, asset-heavy businesses the benefit of the doubt. This creates a bifurcated market where short sellers must carefully choose their battles. Fraud allegations work brilliantly against promotional micro-caps but bounce off larger, more established companies with tangible assets.
🏆 Firm Rankings
Performance by Research Firm
🎪 Notable Campaigns
🔥 The Bear Cave vs. Pheton Holdings
Ticker: PTHL
Impact: -97.15%
Thesis: Chinese medical device company accused of stock manipulation and fabricating a $141M acquisition deal. Report alleged overseas manipulation groups were spreading fake M&A rumors through social media to pump the stock.
Fraud Manipulation🔥 Fugazi vs. BitMine Immersion
Ticker: BMNR
Impact: -71.37%
Thesis: Financial services company allegedly used a $250M private placement to facilitate insider profits. Report claimed company had no operational Ethereum treasury despite announcing major purchase, with CEO structuring insider deals for risk-free returns.
Insider Trading Crypto Fraud⚠️ BMF Reports vs. Aether Holdings
Ticker: ATHR
Impact: -31.82%
Thesis: Software company operating from a 235-square-foot virtual office accused of being a premeditated scheme. Report highlighted IPO lock-up violations, FINRA-barred enforcer Frank Cid, and phantom signatories with no connection to venture capital.
Accounting Promotional❌ Gotham vs. Texas Pacific Land
Ticker: TPL
Impact: +4.49%
Thesis: Alleged significant overvaluation driven by artificial index buying and misperceptions about Horizon Kinetics' trading activity. Claimed TPL trades at 53-61% downside from current levels, but market ignored the call entirely.
Valuation💡 Strategic Insights
1. The Fraud Premium
Allegations of outright fraud (manipulation schemes, fake transactions, insider dealing) generated catastrophic declines averaging -66% across the top three reports. Meanwhile, reports focused on accounting concerns, promotional tactics, or valuation disagreements averaged just -6%. The market demands smoking guns, not subtlety.
2. Size Matters (A Lot)
Micro-caps (under $500M market cap) with fraud allegations cratered -49% on average, while large-caps (over $10B) declined just -1.9% despite negative reports. The disparity reflects liquidity dynamics: small companies lack the institutional support to absorb coordinated selling, while large-caps can easily shrug off short attacks. Mid-cap targets ($2B-$10B) fell -16%, showing that even moderately-sized companies struggle to defend against well-researched fraud allegations.
3. The China Discount
Chinese-listed companies faced an average -43% decline versus -13% for U.S. targets. Whether due to legitimate governance concerns or market bias, investors remain highly skeptical of Chinese companies listed in U.S. markets, particularly those with promotional characteristics or questionable disclosure.
4. Asset-Heavy Defense
Companies with tangible assets (land, infrastructure, physical operations) proved remarkably resilient. Oil & gas targets averaged +8% gains, while asset-light tech and financial names averaged -67%. You can't fake oil rights or Permian Basin acreage.
5. The Healthcare Wild Card
Healthcare remains the most unpredictable sector. Blue Orca's Nutex report generated a solid -24% decline by exposing billing scheme irregularities, while Bleecker Street's United Therapeutics attack barely moved the needle (-8%) despite detailed competitive analysis. The sector requires surgical precision in thesis execution.
For the most devastating single-report impact in recent memory
The Bear Cave earned July's crown with surgical precision, delivering a report so devastating it effectively removed Pheton Holdings from the market. The Chinese tech company, which had surged on fake acquisition rumors, collapsed 97% in a single session after The Bear Cave exposed the alleged manipulation scheme in exhaustive detail.
What made this report exceptional: Rather than relying on accounting analysis or valuation arguments, The Bear Cave documented a real-time stock manipulation campaign, complete with screenshots of promotional groups, fake press releases, and coordinated social media pumping. The thesis was irrefutable, the evidence overwhelming, and the execution flawless.
In a month where nearly half of all short reports backfired, The Bear Cave demonstrated that quality over quantity still reigns supreme in activist short selling. One perfectly executed takedown beats a dozen mediocre reports every single time.
Bottom Line
July 2025 was a master class in thesis selection. The winners (The Bear Cave, Fugazi Research, BMF Reports) chose targets with clear fraud markers, weak governance, and promotional characteristics. They documented specific, verifiable allegations and let the evidence speak for itself. The result: catastrophic declines averaging -66%.
The losers (reports on established large-caps, asset-heavy companies, and diversified conglomerates) learned a harsh lesson: the market doesn't care about your valuation model if the company has tangible assets and institutional support. Gotham City's TPL and LandBridge reports and Bleecker Street's United Therapeutics critique all fell flat because investors viewed these as opportunistic rather than existential threats.
Looking ahead: The activist short selling playbook is evolving. Fraud allegations against promotional micro-caps remain devastatingly effective, while valuation-based attacks on established companies increasingly fall flat. As markets bifurcate between speculative micro-caps and quality large-caps, short sellers must choose their battles wisely, or risk becoming collateral damage in the very rallies they're trying to short.
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The common thread? Small-cap Chinese and crypto-adjacent names with questionable governance and promotional tactics proved most vulnerable to short attacks. Meanwhile, BMF Reports' critique of Aether Holdings' fintech claims generated a respectable 32% decline, demonstrating that even U.S.-based micro-caps with aggressive promotional tactics aren't immune to scrutiny.