Michael Burry Calls Tesla 'Ridiculously Overvalued,' Cites Competition Concerns

Michael Burry, the investor famously depicted in "The Big Short," has publicly stated his belief that Tesla's market capitalization is "ridiculously overvalued." In a recent newsletter, Burry expressed skepticism about the company's recurring shifts in focus, suggesting that each new venture, from electric cars to autonomous driving and now robots, faces significant competition.

Key Takeaways

• Michael Burry believes Tesla is "ridiculously overvalued.

• He points to the company's history of shifting focus as new competition emerges.

• Burry previously held a significant short position against Tesla.

Burry's Valuation Concerns

Burry, known for his prescient bearish calls, articulated his strong doubts about Tesla's current valuation, stating it has been "ridiculously overvalued" for a considerable period. He specifically critiqued the company's strategic pivots, noting a pattern where the "Elon cult" becomes heavily invested in a particular technology, only to face increased competition shortly thereafter. This cycle, he suggests, is now repeating with the company's focus on robotics.

Past Bets Against Tesla

This is not the first time Burry has voiced strong opposition to Tesla. Several years ago, his firm, Scion Asset Management, initiated a substantial bet against Tesla shares, reportedly worth $530 million. While Burry eventually closed this short position in October 2021, his skepticism towards the company and its CEO, Elon Musk, has persisted. Despite Burry's bearish stance, Tesla's stock has seen significant growth since 2020, increasing by over 115 percent.