Investor Michael Burry of ‘The Big Short’ fame revealed on Tuesday that he was shorting Elon Musk-led Tesla Inc. (NASDAQ:TSLA), as well as chipmaker Nvidia Corp. (NASDAQ:NVDA) and others.
Shorting Tesla, Nvidia
In a Substack post, Burry revealed that he had moved put options on the iShares Semiconductor ETF (NASDAQ:SOXX) from January 2027 to March 2027, while also moving the strike price from approximately $320-$350 to more than $400.
He said that the Philadelphia Semiconductor Index was “at a historically high extension above its 200-day moving average,” adding that the levels were not seen since the year 2000.
Burry also added that the price-to-sales ratio on the index was “very high” at over 16x, despite excluding NVIDIA from the index.
The investor said that he had shorted Caterpillar Inc. (NYSE:CAT) at $1060.98. “I also shorted Nvidia (NVDA) at $198.09,” Burry said and added that he also shorted the iShares Semiconductor ETF.
Applied Materials Inc. (NASDAQ:AMAT) is also among the candidates shorted by the investor at $729.40. Notably, Cantor Fitzgerald analyst C.J. Muse raised his forecast on the stock to $850 from $650 and reiterated an Overweight rating.
“The SOXX itself is a pure form of overvaluation in an index, a form that is rarely seen and never so easily recognized as such,” the investor said, adding that it was only a “matter of time” before the index declines. He also said that the index rallied because of Korean spending. “I see that as the beginning of the end,” he said.
“I shorted Tesla (TSLA) at 416.22. Happy it jumped back to this level,” Burry said, but did not include a dollar figure or his exact position. Notably, Tesla jumped close to 10% and currently trades at $415.95 during the after-hours session on Tuesday.
Burry’s Palantir, Nvidia Positions
The investor had called out NVIDIA’s financing arrangements “fugazi” and outlined the complexity of these arrangements that help “tens of $billions worth of NVDA GPUs disappear from balance sheets.”
He had shared a diagram that demonstrated how retirement money flowing into annuities supported financing structures that involved insurers, reinsurance entities, as well as private credit firms that helped fund AI infrastructure. Burry has also shorted Palantir Technologies Inc. (NASDAQ:PLTR).
Tesla’s Valuation Concerns
While the investor had sounded out his concerns with Tesla’s valuation, he is not the only one who has called the stock “overvalued.”
Investor Gary Black of The Future Fund LLC has also called out the EV giant’s valuation on several occasions. The investor has said that he exited his Tesla position due to declining earnings estimates, among other reasons.
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