Xiaomi Corporation enters the final days of May with an unusual split: a strong Q1 earnings print on one side and a fresh bearish call from a major bank on the other. That tension is the week's defining feature.
Short interest has climbed steadily through the month and now represents 7.0% of the free float — up roughly 18% from a month ago. The move is notable because it follows the late-April lows when SI was closer to 12.8% less of the float. Bears rebuilt positions through May as the stock softened. Yet the short score, which peaked at 67.2 on May 13, has since dropped back to 60.8 — a meaningful retreat that suggests the aggression in bearish positioning may have passed its near-term peak. Borrow costs remain low at 0.97% annualised, barely changed on the week and well within normal territory. Availability is ample at 543%, meaning there are roughly five-and-a-half shares available to borrow for every share currently shorted — far from any constraint on further shorting.
The headline catalyst was this week's Q1 2026 results, which showed revenue reaching RMB 99.1 billion alongside what the company described as improved structural indicators and operational quality. The stock opened down marginally on the release day, closing at HK$29.76 — off 0.8% on the day and 2.9% for the week. That muted reaction sits in line with prior earnings history: the most recent comparable quarter (March 2026 results) saw a 1-day move of just +1.4% followed by a 5-day drift of -0.9%, consistent with a market that absorbs Xiaomi prints without dramatic movement in either direction.
The Street backdrop is more complicated. Jefferies moved to a bearish stance on Wednesday, citing smartphone margin pressure — a reminder that the EV unit's costs remain a live debate even as handset volumes track well. The consensus leans toward hold, with five analysts in that camp and a mean price target near HK$36.43 — a 22% premium to current levels that implies the Street still sees upside, but lacks conviction. Factor scores reinforce the caution: forward EPS momentum ranks in just the 9th percentile over 30 days, and the 12-month forward EPS growth trajectory ranks in the bottom 2% of the universe. Valuation, however, is not stretched — the P/E runs near 20.6x and has moved modestly higher over the past month as the price has drifted lower. EV/EBITDA near 13.3x also sits in a range that gives no obvious read on direction.
Peer divergence adds further texture this week. Taiwanese hardware names 2357 (ASUSTeK) and 3231 (Wistron) both posted weekly gains of 10% and 7.7% respectively, while SEHK-listed 3396 surged nearly 29% on the week. Xiaomi's -2.9% weekly loss sits at the weaker end of the group, pointing to a sector backdrop that is broadly constructive for hardware but less generous to consumer-facing China names at present.
Founder and CEO Jun Lei's last disclosed market purchase — 2.6 million shares at HK$38.58 in November 2025 — remains the most recent insider signal on record, acquired well above the current price. The gap between that purchase level and today's HK$29.76 adds context to where insiders last saw value, though the data is now 184 days old and predates both the Q1 results and the Jefferies downgrade.
The next focal point is the Xiaomi 17T series global launch event, scheduled for May 28. Product launches have historically been less market-moving for Xiaomi than earnings prints, but any commentary on EV unit margins or smartphone pricing in competitive markets will be watched closely by a short base that has grown materially this month yet appears, for now, to be consolidating rather than pressing further.
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