Michael Burry Bets Big on Alibaba with Increased Stake

Published 2 days agoBABA

Michael Burry Bets Big on Alibaba with Increased Stake

Michael Burry, famous for his role in predicting the 2008 financial crisis, has made a notable move by boosting his investment in Alibaba Group Holding Ltd. In the third quarter of 2024, Scion Asset Management, Burry's investment firm, increased its Alibaba holdings by 30%, now holding roughly 200,000 shares, according to Invezz.

This significant increase in Alibaba shares comes amid a major portfolio restructuring by Scion Asset Management. During the same period, the firm cut its overall equity portfolio by nearly half, focusing on selected investments like Alibaba, as reported by Investing.com. Analyst sentiments seem to align with Burry's actions, as Citi's Alicia Yap maintains a 'Strong Buy' rating on Alibaba and raised the stock's price target from $133 to $138, reflecting a hopeful 31.91% upside.

Alibaba's current valuation is attractive; the stock trades at a forward P/E ratio of 10.5, perceived as low for a company with growth prospects. Furthermore, Alibaba's substantial cash reserve of $85.5 billion positions it well for strategic share repurchases and reinvestment opportunities. This confidence from investors and analysts signals a robust belief in the company's future potential.

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