{"id":278534,"date":"2025-11-08T03:47:06","date_gmt":"2025-11-08T03:47:06","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/278534\/"},"modified":"2025-11-08T03:47:06","modified_gmt":"2025-11-08T03:47:06","slug":"michael-burry-returns-to-target-ai-tech-bubble-pinups-nvidia-nvda-and-palantir-pltr","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/278534\/","title":{"rendered":"Michael Burry Returns to Target AI Tech Bubble Pinups Nvidia (NVDA) and Palantir (PLTR)"},"content":{"rendered":"

Readers may remember Michael Burry<\/a>, the legendary fund manager portrayed by Christian Bale in the Hollywood movie The Big Short. He was the man who saw the 2008 housing bubble before almost anyone else and made hundreds of millions of dollars for himself and his fund, Scion Asset Management, when the U.S. housing market crashed, triggering the global financial crisis in 2007-09.<\/p>\n

Meet Your ETF AI Analyst<\/p>\n

\"\"Christian Bale with Sibi Blazic at the world premiere of \u2018The Big Short\u2019 in 2015 (Los Angeles).<\/p>\n

A decade later, Burry is back in the headlines with a new bearish bet \u2014 this time targeting two of the most celebrated names in artificial intelligence<\/a> (AI): Nvidia (NVDA)<\/a> and Palantir Technologies (PLTR)<\/a>. <\/p>\n

Through put options, he\u2019s positioning to profit handsomely if either stock takes a sharp tumble. Given Scion\u2019s track record over the past decade \u2014 and Burry\u2019s uncanny knack for spotting bubbles before they burst \u2014 it\u2019s no surprise that market watchers are paying close attention to his latest move.<\/p>\n

\"\"<\/a><\/p>\n

While I understand his reasoning, I don\u2019t think his short thesis is guaranteed to play out soon. In fact, I remain moderately Bullish on both stocks for the foreseeable future. However, it is difficult to argue against the logic behind Burry\u2019s idea; the critical question is the timing.<\/p>\n

Rumors of a Crash Are Bubbling<\/p>\n

During the 2008 financial crisis, Burry personally made around $100 million, while his fund earned an astonishing $700 million from its short positions. At the time, almost everyone thought he was mistaken \u2014 until the market proved him right.<\/p>\n

This time around, the potential payout may not reach those Hollywood-worthy heights, but it could still be substantial. Although the details of his current put options are undisclosed, filings suggest the underlying positions represent $187 million in Nvidia and $912 million in Palantir stock.<\/p>\n

To illustrate, if Burry spent $5 per contract to secure puts against 5 million Palantir shares, that would be a $25 million outlay. If Palantir\u2019s stock were to drop from $190 to $100, those puts (granting the right to sell at $190) would be worth $90 each, thereby turning a hypothetical $25 million into $425 million \u2014 a 17x return before taxes.<\/p>\n

\"\"<\/a><\/p>\n

The AI Hype May Hit a Speed Bump<\/p>\n

Talk of an AI<\/a> bubble has intensified as valuations across the sector stretch to dizzying heights. Adding to that concern, major U.S. grid operators such as PJM Interconnection (PJM) and the Electric Reliability Council of Texas (ERCOT) are warning that the explosive energy demand from AI data centers is beginning to strain existing infrastructure.<\/p>\n

An energy supply crunch doesn\u2019t signal the end of the AI boom, but it does point to considerable short-term volatility and insecurity about the long-term future. Unless hyperscale cloud providers rapidly expand their infrastructure overseas \u2014 a move slowed by regulation and permitting delays \u2014 bottlenecks could temporarily cap AI\u2019s growth momentum.<\/p>\n

I\u2019m Staying Bullish (and Hedged)<\/p>\n

As a shareholder of both Nvidia and Palantir, I\u2019m not dismissing Burry\u2019s concerns. But I\u2019m not following his path either. Instead, I\u2019m hedging intelligently. Recently, I added Natural Gas Services Group (NGS)<\/a> to my portfolio as a dual-phase hedge against AI-related energy shortages. Unlike Burry\u2019s outright bearish bets, I remain bullish long term on Nvidia and Palantir \u2014 but I want protection in case a correction hits.<\/p>\n

\"\"<\/a><\/p>\n

Alongside NGS and First Solar (FSLR)<\/a>, I\u2019m maintaining a 20% cash position. If markets tumble, these positions should cushion my downside \u2014 and the cash will enable me to acquire AI leaders at discounted prices.<\/p>\n

Wall Street Loves Nvidia but Still Doesn\u2019t Get Palantir<\/p>\n

Wall Street analysts, as usual, are lining up strongly behind Nvidia, while taking a far more measured stance on Palantir. Nvidia\u2019s coverage is almost unanimous on Wall Street: 37 Buys, one Hold, and not a single Sell rating. The consensus is a Strong Buy, with an average price target of $237.35<\/a>, implying ~28% upside over the next 12 months. <\/p>\n

\"\"<\/a>See more NVDA analyst ratings<\/a><\/p>\n

In contrast, Palantir occupies a murkier middle ground for analysts. The defense-sector tech juggernaut has acquired two Buys, eleven Holds, and one Sell, translating to a consensus Hold rating and an average target of $187.87<\/a>, implying ~8% in potential upside over the next twelve months.<\/p>\n

\"\"<\/a>See more PLTR analyst ratings<\/a><\/p>\n

Notably, analysts have been wrong about Palantir before\u2014on multiple occasions. Despite rating the stock a \u2018Hold\u2019 almost nonstop over the past five years, the stock has soared more than 1,000%. <\/p>\n

\"\"<\/a><\/p>\n

That persistent underestimation highlights how Wall Street often struggles to properly value companies that defy traditional categories\u2014particularly firms like Palantir, which operate at the intersection of technology and defense. So while the current consensus might seem lukewarm, seasoned investors know better than to take those ratings at face value. <\/p>\n

Many Palantir bulls see the company today much like Amazon (AMZN)<\/a> in 1997\u2014at the embryonic stage of evolving into a global household name with a powerful competitive moat, poised to generate hundreds of billions in resilient, recession-proof cash flow over the long term.<\/p>\n

Stay in AI but Keep Your Eye on the Ball<\/p>\n

Michael Burry is often early \u2014 rarely wrong. But in markets, timing is everything, and being right too soon can feel a lot like being wrong. His put options on Nvidia and Palantir reflect legitimate medium-term risks \u2014 from mounting energy bottlenecks to sky-high valuations \u2014 yet those concerns don\u2019t herald the end of the AI revolution. That\u2019s somewhat premature, although by the same token, so too are the sky-high valuations of fast-growing names like Palantir, which may have also raced a bit too far ahead of their fundamentals and perhaps a little too prematurely into investors\u2019 good graces.<\/p>\n

Investors who bolt for the exits now risk missing the next major leg higher once the market shakes off its current anxiety about a so-called \u201cAI bubble.\u201d I count myself among the bullish camp staying long on AI\u2019s long-term promise, but I\u2019m not doing so blindly. I\u2019m hedged by a healthy cash reserve, ready to pounce on any undervaluations that emerge if a correction hits. My recent additions in the energy sector further solidify my portfolio, providing insulation if my bullish AI thesis suffers a setback.<\/p>\n

In short, I see where Burry\u2019s coming from: his logic is sharp, his caution warranted. But this time, I\u2019m choosing conviction over imitation.<\/p>\n

Disclaimer & Disclosure<\/a>Report an Issue<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Readers may remember Michael Burry, the legendary fund manager portrayed by Christian Bale in the Hollywood movie The…\n","protected":false},"author":2,"featured_media":278535,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[45],"tags":[182,181,507,74],"class_list":{"0":"post-278534","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/278534","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=278534"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/278534\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/278535"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=278534"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=278534"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=278534"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}