Monthly Report6 min read

May 2025 Activist Short Selling Report

May 2025 Activist Short Selling Performance Report 8 Total Reports -5.6% Average Impact 50% Success Rate May 2025 delivered a study in contrasts. While the month produced fewer reports than typical,…

Activ8 Newsroom • December 10, 2025

May 2025

Activist Short Selling Performance Report

Total Reports

-5.6%

Average Impact

50%

Success Rate

May 2025 delivered a study in contrasts. While the month produced fewer reports than typical, the quality of research diverged dramatically. One campaign destroyed over half of a target's market cap, while three others saw their targets rally double digits against the short thesis. With a 50% success rate and a -5.6% average impact, May demonstrated that even in a quieter month, activist short sellers can still deliver devastating blows when they find the right target. The story of May is less about volume and more about thesis precision.

📉 Top Performers

Reports with Greatest Negative Impact

MFH

-51.3%

TEM

-14.8%

ACHR

-9.9%

TMC

-6.9%

May's top performer was a masterclass in thesis execution. Morpheus Research's report on Mercurity Fintech Holding (MFH) obliterated over half the company's value in just three weeks, making it one of the most devastating single-report impacts of the year. The China-based fintech became May's poster child for why investors should pay attention when activist short sellers raise red flags about capital markets operations. Meanwhile, BMF Reports continued their steady campaign work, landing two of the top four spots with Tempus AI and The Metals Company both taking meaningful hits.

📈 Reports That Struggled

Reports Where Shorts Faced Headwinds

NXST

+16.6%

UFPT

+16.0%

MAIN

+5.4%

AUR

0.0%

May proved that even well-researched theses can run headfirst into unfavorable market dynamics. BMF Reports' Nexstar Media Group report and WolfPack Research's UFP Technologies campaign both saw their targets rally over 16% against the short position. This wasn't necessarily a reflection of thesis quality but rather of broader market sentiment and sector rotation. Jehoshaphat Research's Main Street Capital report (+5.4%) struggled in the BDC space where yield-hungry investors continue to pile in regardless of fundamental concerns. Bleecker Street's Aurora Innovation report finished flat, neither vindicating nor refuting the autonomous vehicle thesis.

🏦 Market Breakdown

By Exchange

NASDAQ

6 reports (75% of total)

Avg. Impact: -9.3%

Targets: TEM, TMC, AUR, MFH, UFPT, NXST

NYSE

2 reports (25% of total)

Avg. Impact: -2.3%

Targets: ACHR, MAIN

Geographic Distribution

🇺🇸 United States 6 reports

🇨🇦 Canada 1 report

🇨🇳 China 1 report

NASDAQ dominated May's activity with 75% of all reports, and that's where the action was. The tech-heavy exchange saw an average impact of -9.3%, driven largely by Morpheus Research's devastating MFH takedown. The NYSE's two reports averaged just -2.3% as the more established companies on that exchange proved harder to move. Geographically, the U.S. remained the primary hunting ground, though it's worth noting that May's single best-performing report targeted a China-based company, suggesting opportunities remain in cross-border research.

🏭 Industry Analysis

Industry	Reports	Key Target	Avg. Impact
Financial - Capital Markets	1	MFH	-51.3%
Healthcare IT	1	TEM	-14.8%
Aerospace & Defense	1	ACHR	-9.9%
Industrial Materials	1	TMC	-6.9%
IT Services	1	AUR	0.0%
Asset Management	1	MAIN	+5.4%
Medical Devices	1	UFPT	+16.0%
Entertainment	1	NXST	+16.6%

May's industry spread was remarkably diverse, with eight different sectors represented across just eight reports. Financial services proved most vulnerable, with the MFH campaign delivering a crushing -51.3% impact. Healthcare IT and Aerospace also saw meaningful negative moves. On the flip side, established sectors like Entertainment and Medical Devices proved resilient, with both targets rallying over 16% against short theses. The lesson: sector matters, but target selection within sectors matters more.

🏆 Firm Rankings

Research Firm Performance (May 2025)

1 Report | -51.3% Avg

1 Report | -9.9% Avg

3 Reports | -1.7% Avg

1 Report | 0.0% Avg

1 Report | +5.4% Avg

1 Report | +16.0% Avg

Morpheus Research takes the crown this month with their devastating MFH campaign. Culper Research delivered solid results with their Archer Aviation thesis. BMF Reports had a mixed month, publishing the most reports (3) but averaging just -1.7% impact as their Nexstar miss offset their Tempus and Metals Company wins. The bottom half of the rankings tells the story of a challenging month for some established names, with WolfPack's UFP Technologies report facing a 16% move against them.

📋 Notable Campaigns

🔥 Campaign of the Month: MFH

Firm: Morpheus Research

Target: Mercurity Fintech Holding

Impact: -51.3%

Thesis: Capital markets operations and corporate governance concerns at this China-based fintech. The report raised questions about related-party transactions and the sustainability of the company's business model.

Fraud Allegations Governance

🎯 BMF's AI Double Feature

Firm: BMF Reports

Targets: Tempus AI (TEM) & The Metals Company (TMC)

Combined Impact: -10.8% avg

Thesis: BMF tackled two different sectors with precision. Their Tempus report questioned the sustainability of AI-driven healthcare valuations, while the TMC report scrutinized deep-sea mining economics.

Valuation Technology

✈️ Culper Takes on Flying Taxis

Firm: Culper Research

Target: Archer Aviation (ACHR)

Impact: -9.9%

Thesis: Culper raised concerns about the timeline and economics of Archer's eVTOL (electric vertical takeoff and landing) aircraft commercialization, questioning whether the company can achieve profitability before running out of capital.

Cash Burn Execution Risk

❌ WolfPack's Miss: UFP Technologies

Firm: WolfPack Research

Target: UFP Technologies (UFPT)

Impact: +16.0%

Thesis: WolfPack's medical devices thesis ran into a wall as the market shrugged off concerns. Sometimes even quality research collides with momentum-driven buying.

Valuation

💡 Strategic Insights

Key Takeaways from May 2025

1. China-Linked Targets Remain Vulnerable

Morpheus Research's MFH campaign (-51.3%) demonstrates that U.S.-listed Chinese companies remain highly susceptible to activist short reports. Investors continue to react strongly to governance and transparency concerns, making this a fertile hunting ground for researchers willing to do the work.

2. Market Cap Divergence Continues

May reinforced a pattern we've seen throughout 2025: small-cap targets move significantly (MFH at $486M saw -51% decline), while larger companies prove more resilient. The average market cap of successful shorts was $2.3B vs $7.1B for reports that saw targets rally.

3. Volume vs. Precision Tradeoff

BMF Reports published three reports but averaged only -1.7% impact as their miss on Nexstar (+16.6%) offset their wins. Compare this to Morpheus's single devastating report. Quality of thesis and target selection continues to outperform spray-and-pray approaches.

4. Sector Rotation Creates Headwinds

Entertainment (NXST) and Medical Devices (UFPT) both saw targets rally 16%+ despite short reports. When sectors are in favor, even well-researched theses face uphill battles against momentum and flows.

5. 50% Success Rate Is Sustainable

May's coin-flip success rate might seem underwhelming, but the magnitude matters. The average winner (-20.7%) significantly outpaced the average loser (+9.5%). In a risk-adjusted framework, May was still a positive month for short-focused strategies.

🎯 Final Thoughts

The Bottom Line

May 2025 was a tale of extremes. One report destroyed half a company's value while others watched their targets rally into the teeth of short theses. The month's 50% success rate and -5.6% average impact mask a more nuanced reality: when activist short sellers find the right target with the right thesis, the results remain devastating.

Morpheus Research's MFH campaign stands as the month's defining moment, proving that China-linked capital markets plays remain vulnerable territory. Meanwhile, the struggles of established names like WolfPack and BMF (on certain picks) remind us that market conditions can overwhelm even solid research.

Looking ahead: The divergence between small-cap vulnerability and large-cap resilience continues to shape opportunity. Researchers who can identify the next MFH-style situation, with clear governance red flags and limited institutional support, will find the market remains eager to price in fraud risk. But betting against momentum in favored sectors? That's a recipe for pain, regardless of fundamental merit.

Disclaimer: This report is for informational purposes only and does not constitute investment advice. Past performance of activist short reports does not guarantee future results. All data reflects price changes from report publication date through May 30, 2025. Always conduct your own due diligence before making investment decisions.

Activ8 Insights | May 2025 Monthly Report