TLDR
- Michael Burry added to his positions in MercadoLibre, Adobe, PayPal, Lululemon, and Zoetis.
- He bought MercadoLibre in the mid-$1,500 range, calling it a long-term winner at a discount.
- Burry took a full-sized stake in Lululemon, which he views as undervalued.
- He warned that AI investment is creating a bubble similar to the dot-com era.
- Data shows 87% of venture capital now flows to AI companies, mirroring 1999 tech funding patterns.
Michael Burry, the investor made famous by The Big Short, has been quietly buying stocks he believes the market is ignoring. While money pours into AI, he is going the other way.
On Monday, Burry disclosed new purchases across five companies: MercadoLibre, Adobe, PayPal, Lululemon Athletica, and Zoetis.
He shared his thinking in a post on Substack, describing these stocks as part of a “mass whale fall” happening away from the main spectacle.
Burry’s Picks and His Reasoning
Burry said he added to MercadoLibre in the mid-$1,500 range. He called it a clean long-term winner that is trading at a discount because of its international exposure.
He also increased his stakes in Adobe and PayPal, and described Zoetis — an animal health company — as a “fat pitch” that requires patience.
His biggest move may have been Lululemon, where he established what he called a full-sized position.
Burry’s view is straightforward: these stocks are being overlooked because investors are chasing AI.
The AI Bubble Warning
Burry drew a direct comparison to 1999. Back then, older economy and international companies were abandoned as money flooded into internet and telecom stocks.
He cited data from Apollo Chief Economist Torsten Slok showing that 87% of venture capital funding now goes to AI-related companies.
AI-linked borrowers account for nearly half of investment-grade bond issuance and around 38% of high-yield debt issuance.
Burry pointed out that more than $100 billion of investment-grade debt issued during the 1999–2000 tech boom was later downgraded to junk within a few years.
He called the current situation an asset bubble.
The stocks Burry is buying have all pulled back from their highs. Lululemon is down sharply over the past year. Adobe has faced questions about its growth. PayPal has struggled to regain investor confidence.
MercadoLibre, while a strong business, has faced pressure because of its exposure to Latin American currencies and markets.
Zoetis operates in the animal health space, largely removed from the technology investment cycle.
Burry’s thesis appears to be that capital rotation out of these names — driven by AI enthusiasm — has created buying opportunities.
His track record gives his contrarian calls weight. He correctly predicted the collapse of the US housing market before the 2008 financial crisis.
Whether these picks prove out remains to be seen, but Burry’s disclosures have drawn attention to a group of stocks that have largely sat out the recent market rally.
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