5 Stocks Big Short’s Michael Burry Is Betting On

Key Takeaways

• Michael Burry added Lululemon to his hedge fund portfolio in April
• Lululemon holds 78 hedge fund owners, indicating broad institutional interest
• New Mexico e‑commerce site and 30+ stores target growth by year‑end
• Analysts maintain Hold ratings, seeing limited near‑term upside

Pulse Analysis

Michael Burry, the hedge‑fund manager who famously profited from the 2008 subprime crash, continues to attract attention whenever his 13‑F filings reveal new bets. In the latest filing, Burry disclosed a stake in Lululemon Athletica, a move that stands out because the stock has been sliding for several quarters and analysts have largely stayed on the sidelines. Burry’s history of spotting mispriced assets—from mortgage‑backed securities to undervalued equities—means his entry is often interpreted as a signal that the market may be overlooking hidden value.

Lululemon’s recent performance has been muted, with the share price drifting lower and 78 hedge funds already listed as holders. Major research houses such as Bernstein and Piper Sandler have kept a neutral Hold rating and have not adjusted their price targets, reflecting limited short‑term upside in their view. Nevertheless, the company is pushing growth through a new e‑commerce portal, Lululemon.mx, and an aggressive store rollout in Mexico—over 30 locations by year‑end and roughly 15 additional stores across North America. This expansion targets a younger, digitally savvy consumer base and diversifies revenue beyond its saturated U.S. market.

If Burry’s assessment proves correct, Lululemon could experience a valuation bounce as investors re‑price the upside from its Latin American push. The Mexico initiative not only adds top‑line growth but also provides a testing ground for the brand’s omnichannel strategy, which could be replicated in other emerging markets. However, risks remain: execution of store openings, currency fluctuations, and continued analyst skepticism could temper gains. Traders should monitor quarterly earnings, same‑store sales in Mexico, and any changes in hedge‑fund ownership to gauge whether the stock is poised for a breakout.