The investor who inspired the film 'The Big Short', well-known hedge fund manager Michael Burry, has disclosed he has established a short position in Caterpillar, arguing the construction equipment manufacturer is now overvalued as a beneficiary of the AI infrastructure investment boom.
Burry stated he shorted Caterpillar stock at $1060.98. Additionally, he has newly established short positions in NVIDIA, Applied Materials, Tesla Motors, and the iShares Semiconductor ETF.
Burry wrote in an article published on Substack on Tuesday:
"This is my first time shorting Caterpillar. In the past, being long this stock has worked well for me."
In the first half of 2026, Caterpillar's stock price has surged 86% cumulatively, making it one of the best-performing components of the S&P 500 index this year. As global AI infrastructure investment continues to heat up, more investors are viewing the company as a key stock to play this theme.
Burry indicated that Caterpillar's valuation has risen to a level that alarms him. With the stock hitting record highs, its Price-to-Sales Ratio has climbed to its highest level in at least the past 30 years.
Burry also wrote:
"The immediate catalyst for today's rally is South Korea's announced massive spending plan. But in my view, this is precisely the beginning of the end for this rally. It's now just a matter of time."
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