Mountain Bike Performance Handbook by Lennard Zinn:
"5.2C: Tightening up a Wobbly Freehub.
Many freehubs wobble as they spin. You can see it when the bike is free-wheeling. Grab your freehub and rock it to see how much play yours has. Eliminating the wobble will improve shifting and reduce freehub wear and friction.
You can practically eliminate the wobble in a Shimano freehub by removing one internal shim. The shims are inside to account for possible deviations in manufacturing tolerances. Since it is better to have a wobbly freehub than one that is too tight to turn, the shims are automatically installed in all freehubs to add a little play. Remove the thinnest shim, and reassemble the freehub, tightening the hub bearing race down fully with the tool. The freehub should spin freely without rocking. The cogs will now stay in line and shift faster.
If removing the shim tightens the freehub too much, yet there is play in it with the shim installed (or if there is still play after removing the shim), you can eliminate the play with some sanding. Sand the bottom of the hub-bearing race by rubbing it on a piece of sandpaper held down on a flat surface. You are sanding the surface at the end of the threads. Reassemble the freehub with one or both shims installed, whatever works best."
https://www.bikeforums.net/bicycle-mechanics/538058-wobbly-freehub.html
Mountain Bike Performance Handbook by Lennard Zinn:
"5.2C: Tightening up a Wobbly Freehub.
Many freehubs wobble as they spin. You can see it when the bike is free-wheeling. Grab your freehub and rock it to see how much play yours has. Eliminating the wobble will improve shifting and reduce freehub wear and friction.
You can practically eliminate the wobble in a Shimano freehub by removing one internal shim. The shims are inside to account for possible deviations in manufacturing tolerances. Since it is better to have a wobbly freehub than one that is too tight to turn, the shims are automatically installed in all freehubs to add a little play. Remove the thinnest shim, and reassemble the freehub, tightening the hub bearing race down fully with the tool. The freehub should spin freely without rocking. The cogs will now stay in line and shift faster.
If removing the shim tightens the freehub too much, yet there is play in it with the shim installed (or if there is still play after removing the shim), you can eliminate the play with some sanding. Sand the bottom of the hub-bearing race by rubbing it on a piece of sandpaper held down on a flat surface. You are sanding the surface at the end of the threads. Reassemble the freehub with one or both shims installed, whatever works best."