Big Short investor Michael Burry is aggressively reallocating capital toward beaten-down stocks, warning the artificial intelligence (AI) boom increasingly resembles the dot-com era.
According to him, a remarkable 87% of venture funding now targets AI, creating what he dubs an “asset bubble – plain and simple”.
To hedge against it, Burry is decisively rotating into “old economy” and international names. And his latest filings reveal he’s recently increased exposure to the following five names.
MercadoLibre (MELI)
Burry increased his stake in Latin American e-commerce giant MercadoLibre in the mid-$1,500s.
While investors have recently pulled back due to macro headwinds, local currency fluctuations, and international exposure risks, MELI boasts a dominant market share and robust underlying business fundamentals.
Burry views the compressed valuation as a steep markdown for a premier compounder operating far outside the mainstream market’s focus.
Adobe (ADBE)
As capital floods toward core hardware, software giants like Adobe have faced steep sell-offs over fears that AI will disrupt creative jobs and software-as-a-service (SaaS) expansion models.
Burry is taking the contrarian side of this tech panic, signaling deep confidence in ADBE’s long-term business model and treating the AI-driven retreat as an optimal entry point for an industry-leading franchise.
The company’s record Q1 results in March might have made it even more attractive for the famed investor.
PayPal (PYPL)
PayPal shares have seen immense pressure as investors punish the firm during its multi-year effort to reclaim its glory within the broader fintech space.
But Burry views PYPL as a beneficiary of a classic “whale fall” – a high-margin business whose stock has been abandoned by momentum traders, offering value investors an attractive risk-reward profile.
And a healthy 1.28% dividend yield makes PayPal much more compelling as a long-term holding.
Lululemon (LULU)
Lululemon stock has also been a disappointment for investors since early 2025, amidst competitive pressures and the subsequent slowdown in North American demand.
Yet, Burry recognizes “significant” intrinsic value in the brand’s premium consumer base. For the hedge fund manager, LULU is just too attractive to pass up at just 1.3x sales.
Plus, the company’s relative strength index (RSI) sits in the mid-20s currently, signaling “oversold” conditions that often trigger a sharp near-term rally.
Zoetis (ZTS)
Burry expanded his holding in Zoetis, explicitly labeling the animal healthcare leader a “fat pitch” that simply requires patience.
Operating entirely outside the volatile tech and AI investment cycles, ZTS offers a highly defensive business model. He is leveraging the market’s lack of attention on steady, non-cyclical healthcare assets to build a position in a resilient business at a significant discount.
Note that Zoetis shares have a history of closing both June and July in “green” – a seasonal pattern that makes them even more attractive to own in the near-term.
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