‘Big Short’ Investor Michael Burry Slams Tesla As ‘Ridiculously Overvalued’

Michael Burry is warning that Tesla is deeply overvalued, arguing that the electric carmaker’s heavy use of stock-based compensation is masking its true profitability. In a post to subscribers of his paid Substack, the “Big Short” investor said Tesla dilutes shareholders by about 3.6% annually and noted that the company conducts no buybacks to offset the effect.

He said the recent shareholder approval of Elon Musk’s $1 trillion compensation package guarantees even more dilution.

Burry pointed to Tesla’s $1.43 trillion market cap and said its valuation ignores the long-term destruction caused by issuing more shares.

Short seller Michael Burry says $TSLA is "ridiculously overvalued."https://t.co/A0crKPHX09 pic.twitter.com/E8yWBk6q7w

— Yahoo Finance (@YahooFinance) December 1, 2025

He also criticized tech giants like Palantir and Amazon for using stock-based compensation to inflate “adjusted” earnings that downplay real expenses.

Quoting Warren Buffett, Burry said treating stock grants as anything other than a cost is essentially a “gift from shareholders.”

His Substack, launched after deregistering Scion Asset Management, has focused heavily on what he sees as an emerging AI-driven market bubble.

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The Organization for Economic Co-operation and Development (OECD) warned Tuesday that the United States faces slowing growth, rising inflation and a weakening labor market in 2026, with an added threat from what it calls a potential AI-driven stock market bubble. AI bubble a “key downside risk” to U.S. economy,

tippinsightsTIPP Staff