Michael Burry Says Palantir Is Worth $46. The Stock Trades at $130. Who's Right?

"He has periodically shorted the market, but what he did last year is the closest to what he did before the Great Recession. Burry reported $912 million in puts on Palantir and $186.6 million in puts on, and that was basically it. He got rid of his diversified holdings and consolidated them into a single big bet against AI. Most dramatically, he liquidated Scion Asset Management, just like he did in 2008."

"Burry did a fundamental teardown of Palantir's business instead of plucking that number from thin air. He wrote a detailed multi-part analysis on his $379 Substack, where he argued Palantir's fair value lies as low as $21, or as high as $146. The $46 fair value comes from one of these scenarios, and is one that is neither too egregiously low nor high enough to go against his own short thesis."

"The reality is that investors have grown pickier over time, and AI is no longer a novelty to them. A company like OpenAI, now struggling to raise money, makes it clear that investors are starting to decipher AI and understand both the constraints and the long payoff period."

Palantir stock has become increasingly vulnerable as investor sentiment shifts and AI loses its novelty status. Michael Burry, known for profiting from the 2008 financial crisis, has positioned himself as a contrarian by consolidating $912 million in puts on Palantir and $186.6 million in puts on other holdings. He liquidated Scion Asset Management entirely, mirroring his 2008 strategy. Burry conducted fundamental analysis establishing Palantir's fair value between $21 and $146, with his $46 target representing a middle scenario. This represents a dramatic decline from current trading levels near $130, suggesting significant downside risk according to his assessment.

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