Hedge funds are increasingly taking short positions in Xiaomi Corp, according to Goldman Sachs, as investors grow cautious ahead of the Chinese tech and EV company’s third-quarter earnings, according to a report by Bloomberg citing data from Goldman Sachs.
The bank’s prime brokerage desk reported a 53% rise in short interest over the past week, with high-touch desk flows showing elevated selling activity from pension funds and hedge funds over the last two weeks. The bank noted that Xiaomi has become a “consensus short/sell” in the near term due to a lack of catalysts, including safety concerns, factory delays, and weak uptake of its electric vehicles despite recent promotions.
Sentiment has turned sharply negative since earlier in the year, when optimism around Xiaomi’s EV expansion supported its share price. The stock has fallen more than 25% since early July, with a fatal car crash last month contributing to the decline.
Goldman analysts have cut their price target by over 10%, citing margin pressures from rising memory chip costs. Xiaomi is scheduled to report Q3 earnings on 18 November, with revenue expected to grow 23% year-on-year, according to Bloomberg consensus estimates.
