Short Sellers Went 4-for-4 This Week
Weekly Wrap Up: Sunday, June 28, 2026
Short sellers spent the week testing how far conviction travels when the target is a household name. The loudest story was SpaceX, where bears have started nibbling at the freshly public rocket maker even as most admit they are still too wary of Elon Musk to swing hard. Up in Canada, exchange operator Abaxx called in the law firm Paul Weiss and asked regulators to investigate trading in its shares after Viceroy Research accused its Singapore venue of wash trading. Egypt, meanwhile, edged closer to allowing short selling on its exchange at all, finalizing a framework meant to bring the market in line with global standards. Closer to home, four fresh reports landed and every one of them worked by Friday. Pelican Way's takedown of Hyliion was the standout, dragging the stock down more than 40% on the week. We also published a deep dive on Andrew Left's real track record, tallying the wins and losses across 50 Citron campaigns now that the verdict is finally in. Plenty to dig into.
Quick Hits on This Week's Reports:
- Morpheus Research flagged Velo3D (VELO), alleging its turnaround rests on a dead SpaceX relationship, unfunded defense contracts, and a CEO with a fabricated biography. Stock closed the week down 7.8%.
- Umibozu Research targeted EquipmentShare.com (EQPT), alleging the founder brothers funneled at least $77 million through undisclosed related parties tied to the company's sale-leaseback program. Stock closed the week down 14.2%.
- Pelican Way Research went after Hyliion Holdings (HYLN), alleging a $133 million letter of intent with a near-empty shell entity propped up a sham AI data center pivot. Stock closed the week down 40.4%.
- Fugazi Research called out FreeCast (CAST), alleging a Starlink press release manufactured hype around a company with $350,859 in nine-month revenue and a going-concern warning. Stock closed the week down 5.2%.
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With Andrew Left now convicted, we went back through 50 documented Citron Research campaigns to measure what his reports actually did to stock prices. The targets fell an average of 9.8% within five trading days, 76% closed lower than their report-date price, and 16 were eventually delisted. The data tells a sharper story than either his fans or his critics.
New Activist Reports
Morpheus Research Short Report on Velo3D
| Metric | Price | Change |
|---|---|---|
| Close (Day Before) | $18.05 | — |
| Low (Report Date) | $16.14 | -10.58% |
| Close (Report Date) | $17.38 | -3.71% |
| Close (End of Week) | $16.64 | -7.81% |
Stock Price Impact
Velo3D met immediate selling when Morpheus published on June 25. Shares hit an intraday low of $16.14, down 10.58% from the prior close of $18.05, before recovering to finish at $17.38, a 3.71% loss. The selling resumed later in the week, and the stock closed Friday at $16.64, down 7.81%. The modest day-one move relative to the larger weekly drawdown is a familiar pattern, as the market often needs a few sessions to digest a dense, document-heavy thesis.
About The Company
Velo3D is a California-based metal additive manufacturing company that went public via SPAC in 2021. It builds Sapphire-brand 3D printers for aerospace, defense, and space customers, with SpaceX historically its anchor buyer at roughly 28% of revenue in 2021 and 2022. After revenue peaked in 2022, the company was delisted from the NYSE by September 2024 and neared bankruptcy. In December 2024, Arun Jeldi took control through a debt-for-equity exchange and launched the in-house parts business Rapid Production Solutions.
Key Points from the Report
- According to Morpheus, SpaceX has not bought a Velo printer since 2022 and in October 2024 paid a one-time $5 million fee for a perpetual, royalty-free license to all of Velo's IP, letting it build printers in-house without paying Velo again.
- The report alleges the promoted defense pipeline is largely unfunded: the $32.6 million Project FORGE contract was only 9% funded, and a $9.8 million Defense Logistics Agency award had zero dollars obligated as of June 23, 2026.
- Morpheus alleges CEO Arun Jeldi fabricated his biography, calling himself a "doctor" despite holding only a physical therapy license, while his claimed $50 million healthcare company defaulted on $3.6 million in loans.
- The report calls Velo structurally overvalued at 10.7x price-to-sales, with seven unremediated material weaknesses, 129% share dilution, and roughly $54 million of CEO shares pledged as loan collateral.
Read the Full Report Summary →
Umibozu Research Short Report on EquipmentShare
| Metric | Price | Change |
|---|---|---|
| Close (Day Before) | $23.88 | — |
| Low (Report Date) | $21.75 | -8.92% |
| Close (Report Date) | $22.30 | -6.62% |
| Close (End of Week) | $20.48 | -14.24% |
Stock Price Impact
EquipmentShare slid steadily after Umibozu's June 24 report. The stock fell to an intraday low of $21.75, off 8.92% from the prior close of $23.88, and closed at $22.30, a 6.62% decline. The selling deepened through the week, leaving EQPT at $20.48 on Friday, down 14.24%. That steady drift is notable for a company that came public only in January, and it landed less than a month before a lock-up expiration Umibozu argues will flood the market with insider shares.
About The Company
EquipmentShare.com is a Missouri-based construction equipment rental company founded in 2014 by brothers Jabbok and Willy Schlacks, who hold about 81% of voting power. It went public on January 23, 2026, and ranks fourth-largest in U.S. construction rental, managing 262,650 units worth roughly $9.1 billion across 407 locations. Much of its recent growth runs through the OWN Program, a sale-leaseback arrangement with high-net-worth individuals and institutions that now represents 56% of the fleet. The company also operates a proprietary fleet-management platform called T3.
Key Points from the Report
- Umibozu alleges the Schlacks brothers extracted at least $77 million from the company's own OWN Program through three undisclosed related parties: EZ Equipment Zone, Bevel Financial, and Armada Fleet Management.
- It alleges EZ Equipment Zone, which promoted $2.8 billion of OWN fleet, is run from a family embroidery shop in Patton, Missouri (population ~1,000) by founders with no finance or fleet-management background.
- Bevel Financial, whose officers include the Schlacks, collects origination fees of 1.25% or more, while Armada Fleet Management buys $20 million to $100 million equipment tranches despite forming less than two years ago with almost no online presence.
- Umibozu warns that 168 million pre-IPO shares, roughly 71x the 30-day average daily volume, become free-trading when the 180-day lock-up expires on July 21, 2026.
Read the Full Report Summary →
Pelican Way Research Short Report on Hyliion
| Metric | Price | Change |
|---|---|---|
| Close (Day Before) | $7.37 | — |
| Low (Report Date) | $6.08 | -17.50% |
| Close (Report Date) | $6.10 | -17.23% |
| Close (End of Week) | $4.39 | -40.43% |
Stock Price Impact
Hyliion was the week's most dramatic move. The stock dropped almost immediately on Pelican Way's June 23 report, hitting an intraday low of $6.08, down 17.5% from the prior close of $7.37, and closing at $6.10, a 17.23% loss. From there it kept falling, ending Friday at $4.39, down 40.43% on the week, more than four times the typical first-week reaction to a short report. For a stock that had roughly doubled on the disputed catalyst, the unwind erased much of the gain in days.
About The Company
Hyliion Holdings is an Austin-area power generation company whose primary product is the KARNO Power Module, a heat-engine system acquired from General Electric in 2022 for about $37 million. It went public via SPAC in 2020 as an electric-truck company, abandoned that business in 2023, and pivoted to power generation, now positioning KARNO for AI data centers. Fiscal 2025 revenue was roughly $3.5 million against a $57.2 million net loss, with about $139.3 million in current assets burning close to $50 million a year.
Key Points from the Report
- Pelican Way alleges the stock more than doubled on a $133 million letter of intent with VFG Tech Holdings, an entity incorporated in January 2026 with only a registered-agent address, a two-page website, and four LinkedIn employees.
- It argues the VFG deal is about a third of Hyliion's reported $400 million pipeline, overstating that pipeline by at least 33% if the LOI is as hollow as alleged.
- According to Pelican Way, KARNO remains unproven and uncommercialized, with former employees describing years of testing still needed and "no real interest" for it outside Hyliion.
- Pelican Way alleges CEO Thomas Healy drew about $15.4 million in compensation since 2021 against only about $8 million in total company revenue, with no commercialized product to show for it.
Read the Full Report Summary →
Fugazi Research Short Report on FreeCast
| Metric | Price | Change |
|---|---|---|
| Close (Day Before) | $8.07 | — |
| Low (Report Date) | $6.40 | -20.69% |
| Close (Report Date) | $9.84 | +21.93% |
| Close (End of Week) | $7.65 | -5.20% |
Stock Price Impact
FreeCast was the week's wild card. Fugazi published on June 22 into a speculative surge, and the stock first plunged to an intraday low of $6.40, down 20.69% from the prior close of $8.07, before momentum buyers drove it to close at $9.84, up 21.93% on the day. That whipsaw reflects how heavily retail momentum was driving the name after its Starlink and DIRECTV announcements. The enthusiasm faded, and the stock closed Friday at $7.65, down 5.2%, fitting Fugazi's thesis that the run-up was built on hype.
About The Company
FreeCast is a U.S.-based streaming aggregation and ad-tech company that listed on Nasdaq via direct listing on March 10, 2026. It markets platform services to broadband, telecom, multifamily, and sports partners, and recently announced a non-exclusive Starlink reseller deal and a DIRECTV multifamily agreement. For the nine months ended March 31, 2026, revenue was just $350,859 against a net loss above $10 million. It is financed largely through convertible debt from CEO William Mobley's entity, Nextelligence, which holds 25 million of 41.5 million shares.
Key Points from the Report
- Fugazi alleges the June 18 Starlink press release, which sent shares up as much as 170% intraday, describes only a non-exclusive reseller deal with no disclosed value, no minimum, and no signed customer, while SpaceX made no announcement of its own.
- It alleges CEO William Mobley is at once the controlling shareholder (about 88% of voting power), the primary lender via a 12% convertible note, and a preferred holder with a $120 million liquidation preference ahead of public shareholders.
- According to Fugazi, much of FreeCast's tiny revenue is circular, originating from Mobley-controlled entities such as Celebrity Cigars, which accounted for more than a third of quarterly sales.
- Fugazi notes the direct listing created no lock-up, leaving Nextelligence's 25 million shares immediately sellable, a $50 million equity facility now drawable, and auditors flagging substantial going-concern doubt.
Read the Full Report Summary →
Activ8 Newswire
- Abaxx calls in Paul Weiss and seeks a regulatory probe after Viceroy's attack — Toronto-based exchange operator Abaxx Technologies asked Canadian regulators to investigate possible trading manipulation and retained law firm Paul Weiss after Viceroy Research accused its Singapore exchange of sustaining volumes through wash trading. Source: Financial Post
- Short sellers circle SpaceX, but most still won't bet against Musk — Bearish bets on the newly public rocket maker remain in check even after a 28% slide from its post-IPO peak, with only about 5% to 7% of the float sold short as skeptics including Michael Burry stay on the sidelines. Source: CNBC
- Egypt moves closer to launching short selling on the EGX — Egypt's Financial Regulatory Authority is finalizing the framework to introduce short selling on the Egyptian Exchange, a long-awaited step intended to broaden trading strategies, improve liquidity, and bring the market closer to international standards. Source: Waya
