In this article, we discuss 13 stocks that Michael Burry is buying and selling. If you want to see more stocks in this selection, check out 5 Stocks Big Short Michael Burry Is Buying and Selling.
Big Short investor Michael Burry of Scion Asset Management, along with hedge fund managers Farallon Capital Management and Coatue Management, made significant investments in Chinese companies prior to the reopening of China’s borders in January. This reopening followed nearly three years of restrictions on travel and commerce. According to Q4 2022 filings, Burry, who gained fame for his successful bet against U.S. real estate before the 2008 financial crisis, has taken new positions in two Chinese companies.
He bought 75,000 shares of Chinese e-commerce firm JD.com, Inc. (NASDAQ:JD) and 50,000 shares of Chinese technology giant Alibaba Group Holding Limited (NYSE:BABA) in the December quarter. Bank of America Global Research data indicates that the reopening of China has led to an influx of investment in emerging market equities, causing record levels of inflows.
Michael Burry has suggested that the current surge in stocks resembles the dot-com bubble and could end in a similarly devastating crash. Burry recently shared a chart on Twitter that shows the S&P 500’s significant drop between February 2001 and October 2002, along with the decline in the Federal Reserve’s benchmark interest rate during that time. He wrote, “This time is different,” which is likely a dig at commentators who believe the current market rally is sustainable. Burry’s latest chart and comment suggest that he sees similarities between the current market surge and the one in early 2001, when interest rates were at 6%, and he expects both the S&P 500 and the Fed Funds rate to eventually drop, with the Fed cutting rates as the economy weakens and asset prices decline.
“All Theaters are Overcrowded”
Burry has been warning about stocks for a while, and in January, he shared a similar chart that highlighted the S&P 500’s rally between September 2001 and March 2002 before it bottomed out six months later. He has previously advised investors to “sell” and warned that the S&P 500 could drop by over 50% to around 1,900 points. He has also cautioned that the Fed may hesitate to intervene in order to support asset prices, as it could intensify inflation.
He tweeted back in October 2022:
“Difference between now and 2000 is the passive investing bubble that inflated steadily over the last decade. All theaters are overcrowded and the only way anyone can get out is by trampling each other. And still the door is only so big.”
To navigate the uncertain equity market in 2023, some of the stocks that Big Short Michael Burry is buying include Black Knight, Inc. (NYSE:BKI), Alibaba Group Holding Limited (NYSE:BABA), and JD.com, Inc. (NASDAQ:JD).
Our Methodology
We selected the 13 stocks from Michael Burry’s Q4 2022 portfolio which he either sold off entirely, trimmed his position in, or added to his holdings during the quarter. The hedge fund sentiment around the securities was assessed from Insider Monkey’s Q3 2022 database of around 920 elite funds. We have mentioned the stocks Burry sold first, and ranked the remaining list in ascending order of his stake value.
Michael Burry of Scion Asset Management
Stocks Big Short Michael Burry Is Buying and Selling
13. Aerojet Rocketdyne Holdings, Inc. (NYSE:AJRD)
Number of Hedge Fund Holders: 26
Percentage of Stake Sold in Q4 2022: 100%
Aerojet Rocketdyne Holdings, Inc. (NYSE:AJRD) is a California-based company that designs, develops, manufactures, and sells aerospace and defense products and systems in the United States. It operates in two segments, Aerospace and Defense, and Real Estate. In Q3 2022, Michael Burry purchased 132,561 shares of Aerojet Rocketdyne Holdings, Inc. (NYSE:AJRD) worth $5.30 million. In the fourth quarter of 2022, Burry sold the entirety of his stake in the company.
On January 9, Truist analyst Michael Ciarmoli raised the firm’s price target on Aerojet Rocketdyne Holdings, Inc. (NYSE:AJRD) to $58 from $45. In his research note titled “Aerospace & Defense 2023 Outlook – We Favor Defense and Aero Aftermarket,” he recommends a cautious approach due to the challenges that impacted the sector in 2022, which are expected to continue in 2023, including the possibility of a recession, ongoing supply chain pressures, and uncertainties regarding COVID recovery. The analyst advised investors to focus on defensive, high-quality, and recession-resistant companies, with a specific emphasis on those that are expected to perform relatively better. He maintained a Hold rating on the shares.
According to Insider Monkey’s third quarter database, 26 hedge funds were bullish on Aerojet Rocketdyne Holdings, Inc. (NYSE:AJRD), with combined stakes worth $704.2 million.
Unlike Black Knight, Inc. (NYSE:BKI), Alibaba Group Holding Limited (NYSE:BABA), and JD.com, Inc. (NASDAQ:JD), Michael Burry got rid of his position in Rocketdyne Holdings, Inc. (NYSE:AJRD) during the last quarter of 2022.
12. Charter Communications, Inc. (NASDAQ:CHTR)
Number of Hedge Fund Holders: 68
Percentage of Stake Sold in Q4 2022: 100%
Charter Communications, Inc. (NASDAQ:CHTR) was founded in 1993 and is headquartered in Stamford, Connecticut. It functions as a cable operator and broadband connectivity provider, catering to both residential and commercial clients in the United States. It provides internet, video, mobile, and voice services through a subscription-based model, as well as a range of broadband connectivity services such as fixed internet, WiFi, and mobile, along with a security suite. In Q4 2022, Michael Burry sold off his entire stake in Charter Communications, Inc. (NASDAQ:CHTR), worth $3 million.
On January 27, Charter Communications, Inc. (NASDAQ:CHTR) reported a Q4 GAAP EPS of $7.69 and a revenue of $13.67 billion, missing Wall Street estimates by $1.08 and $60 million, respectively. Fourth quarter adjusted EBITDA of $5.5 billion grew by 1.9% year-over-year.
Wells Fargo’s Steven Cahall on January 30 increased Charter Communications, Inc. (NASDAQ:CHTR)’s price target from $340 to $410 while maintaining an Equal Weight rating on the shares. The analyst believes that Charter’s investment approach is becoming more comprehensible.
According to Insider Monkey’s Q3 data, 68 hedge funds were long Charter Communications, Inc. (NASDAQ:CHTR), and Harris Associates held the biggest position in the company, comprising 4.3 million shares worth $1.3 billion.
Here is what Weitz Partners Value Fund has to say about Charter Communications, Inc. (NASDAQ:CHTR) in its Q3 2022 investor letter:
“Liberty Broadband’s primary asset is a 26% stake in Charter Communications (NASDAQ:CHTR). Charter is not sitting still; the company is adapting via footprint expansion into underserved areas, price-advantaged mobile line growth, and so on. Charter’s hefty free cash flows are valuable in the hands of proven, astute capital allocators. Time will tell, but to paraphrase country music artist Merle Haggard, we do not yet think cable’s good times are really over for good.”
11. CoreCivic, Inc. (NYSE:CXW)
Number of Hedge Fund Holders: 17
Percentage of Stake Sold in Q4 2022: 100%
CoreCivic, Inc. (NYSE:CXW) is a Tennessee-based company that owns and manages partnership correctional, detention, and residential reentry facilities in the United States. It operates through three segments – CoreCivic Safety, CoreCivic Community, and CoreCivic Properties. As per 13F filings for the fourth quarter of 2022, Burry sold off his stake in CoreCivic, Inc. (NYSE:CXW), worth $6.40 million.
On February 8, CoreCivic, Inc. (NYSE:CXW) reported a Q4 FFO of $0.42 and a revenue of $471.43 million, outperforming Wall Street consensus by $0.09 and $2.38 million, respectively. For FY 2023, the company expects net income to range from $58.0 million to $75.0 million, FFO per diluted share of $1.35 to $1.50, diluted EPS of $0.50 to $0.65, and EBITDA between $298.5 million to $313.5 million.
According to Insider Monkey’s Q3 data, 17 hedge funds were long CoreCivic, Inc. (NYSE:CXW), with combined stakes worth $57.4 million. Ken Griffin’s Citadel Investment Group held the largest position in the company, consisting of 1.5 million shares worth $13.8 million.
10. Liberty Latin America Ltd. (NASDAQ:LILA)
Number of Hedge Fund Holders: 14
Percentage of Stake Sold in Q4 2022: 100%
Liberty Latin America Ltd. (NASDAQ:LILA) provides fixed, mobile, and subsea telecommunications services. The company operates through C&W Caribbean and Networks, C&W Panama, Liberty Puerto Rico, VTR, and Costa Rica segments. In the third quarter of 2022, Michael Burry acquired 155,761 shares of Liberty Latin America Ltd. (NASDAQ:LILA) worth $958,000. Burry sold his position in the company during Q4 2022.
According to Insider Monkey’s data, 14 hedge funds held stakes worth $58.4 million in Liberty Latin America Ltd. (NASDAQ:LILA) at the end of September 2022, compared to 20 funds in the prior quarter worth $77.4 million. William Crowley, William Harker, and Stephen Blass’ Ashe Capital held the leading position in the company.
Steel City Capital made the following comment about Liberty Latin America Ltd. (NASDAQ:LILA) in its Q3 2022 investor letter:
“Liberty Latin America Ltd. (NASDAQ:LILA) has been a dog this year, declining nearly 45% through the end of the third quarter. The business is highly predictable so there haven’t been any surprises on the operational front, and virtually all of its floating-rate debt has been swapped, thereby protecting it from this year’s rapid rise in interest rates. So I’m not quite sure why it has underperformed the broader market so significantly. This year’s free cash flow guide is for $120 million (ex. SBC) and there’s a line-of-sight to $300+ million (ex. SBC) by 2024, meaning shares have been trading in a range of 4-6x price to free cash flow. The Partnership has been a buyer at these levels.”
9. SkyWest, Inc. (NASDAQ:SKYW)
Number of Hedge Fund Holders: 21
Scion Asset Management’s Stake Value: $2,063,750
SkyWest, Inc. (NASDAQ:SKYW) was incorporated in 1972 and is headquartered in St. George, Utah. The company operates a regional airline in the United States and also leases regional jet aircraft and spare engines to third parties. Michael Burry added SkyWest, Inc. (NASDAQ:SKYW) to his Q4 portfolio by acquiring 125,000 shares worth $2.06 million.
On February 2, SkyWest, Inc. (NASDAQ:SKYW) reported its fourth quarter results, falling short of Wall Street consensus. The company announced a Q4 non-GAAP loss per share of $0.93 and a revenue of $681.25 million, missing market estimates by $1.03 and $72.71 million, respectively.
According to Insider Monkey’s third quarter database, SkyWest, Inc. (NASDAQ:SKYW) was part of 21 hedge fund portfolios, compared to 17 in the prior quarter. Israel Englander’s Millennium Management is the leading stakeholder of the company, with 1.19 million shares worth $19.5 million.
8. Qurate Retail, Inc. (NASDAQ:QRTEA)
Number of Hedge Fund Holders: 25
Scion Asset Management’s Stake Value: $2,445,000 (After a 70% Decline in Stake in Q4)
Qurate Retail, Inc. (NASDAQ:QRTEA) is engaged in the video and online commerce industries in North America, Europe and Asia. In the fourth quarter of 2022, Michael Burry slashed his stake in Qurate Retail, Inc. (NASDAQ:QRTEA) by 70%, holding 1.50 million shares worth $2.4 million.
On November 4, BofA analyst Jason Haas downgraded Qurate Retail, Inc. (NASDAQ:QRTEA) to Underperform from Neutral with a price target of $1.20, down from $4, after the company reported below-consensus Q3 revenue and OIBDA.
According to Insider Monkey’s data, 25 hedge funds were bullish on Qurate Retail, Inc. (NASDAQ:QRTEA) as of the end of September 2022, compared to 24 funds in the earlier quarter. Bob Peck and Andy Raab’s FPR Partners held the biggest position in the company, with 21.8 million shares worth $44 million.
7. MGM Resorts International (NYSE:MGM)
Number of Hedge Fund Holders: 53
Scion Asset Management’s Stake Value: $3,353,000
MGM Resorts International (NYSE:MGM) was incorporated in 1986 and is based in Las Vegas, Nevada. It owns and manages casino, hotel, and entertainment resorts in the United States and Macau. The company operates through three segments – Las Vegas Strip Resorts, Regional Operations, and MGM China. Burry added MGM Resorts International (NYSE:MGM) to his Q4 portfolio by purchasing 100,000 shares worth $3.35 million.
On February 8, MGM Resorts International (NYSE:MGM) reported a Q4 non-GAAP loss per share of $1.53 and a revenue of $3.59 billion, topping market estimates by $0.04 and $240 million, respectively.
Deutsche Bank analyst Carlo Santarelli on February 9 raised the firm’s price target on MGM Resorts International (NYSE:MGM) to $53 from $49 and kept a Buy rating on the shares. This decision was made following the impressive Q4 gaming and revenue per available room metrics for the Las Vegas strip, as well as positive reports from competitors in recent weeks. According to the analyst, there were high expectations for MGM Resorts International (NYSE:MGM)’s performance on the strip, but the company exceeded them with ease.
According to Insider Monkey’s third quarter database, 53 hedge funds were long MGM Resorts International (NYSE:MGM), compared to 46 funds in the prior quarter. Keith Meister’s Corvex Capital is the largest stakeholder of the company, with 6.67 million shares worth $198.3 million.
In addition to Black Knight, Inc. (NYSE:BKI), Alibaba Group Holding Limited (NYSE:BABA), and JD.com, Inc. (NASDAQ:JD), Burry added MGM Resorts International (NYSE:MGM) to his portfolio during the December quarter.
Baron Funds made the following comment about MGM Resorts International (NYSE:MGM) in its Q3 2022 investor letter:
“MGM Resorts International (NYSE:MGM) is a leading global casino and entertainment company with 29 unique hotels and casinos including some of the most recognizable resort brands such as Bellagio, MGM Grand, ARIA, and Park MGM. At its recent price of only $30 per share, we believe MGM’s valuation is compelling at only 6 times 2023 estimated cash flow.”
6. Wolverine World Wide, Inc. (NYSE:WWW)
Number of Hedge Fund Holders: 18
Scion Asset Management’s Stake Value: $3,892,184
Wolverine World Wide, Inc. (NYSE:WWW) is a Michigan-based company that manufactures, markets, licenses, and distributes footwear, apparel, and accessories in the United States, Europe, the Middle East, Africa, the Asia Pacific, Canada and Latin America under the Bates, Cat, Chaco, Harley-Davidson, Hush Puppies, Hytest, Keds, Merrell, Saucony, Sperry, Sweaty Betty, Wolverine, and Stride Rite brands. In the fourth quarter of 2022, Michael Burry purchased 356,101 shares of Wolverine World Wide, Inc. (NYSE:WWW) worth $3.8 million, representing 8.36% of the total 13F holdings.
On February 8, Wolverine World Wide, Inc. (NYSE:WWW) declared a $0.10 per share quarterly dividend, in line with previous. The dividend is distributable on May 1, to shareholders of record on April 3. The forward yield was 2.65%.
Williams Trading analyst Sam Poser on January 16 upgraded Wolverine World Wide, Inc. (NYSE:WWW) to Buy from Hold with a price target of $18, up from $13.
According to Insider Monkey’s Q3 data, 18 hedge funds were long Wolverine World Wide, Inc. (NYSE:WWW), compared to 13 funds in the earlier quarter. Ric Dillon’s Diamond Hill Capital is the leading stakeholder of the company, with 3.60 million shares worth $55.4 million.
Diamond Hill Capital made the following comment about Wolverine World Wide, Inc. (NYSE:WWW) in its Q4 2022 investor letter:
“Footwear and apparel company Wolverine World Wide, Inc. (NYSE:WWW) underperformed as softer demand and elevated inventory levels have necessitated higher-than-expected promotional activity, weighing on near-term profitability. During the quarter, the company announced decisions to simplify its brand portfolio and reduce its workforce — initiatives aimed at generating cost savings. We remain attracted to WWW’s strong collection of brands and its fragmented customer base.”
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Disclosure: None. 13 Stocks Big Short Michael Burry Is Buying and Selling is originally published on Insider Monkey.
