Michael Burry's 'Big Short' Intuition Shifts to AI Investments with Puts on Nvidia and Palantir
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 04 2025
0mins
Should l Buy NVDA?
Source: SeekingAlpha
Michael Burry's Bearish Stance: Michael Burry's Scion Asset Management has taken bearish positions on Nvidia and Palantir, indicating caution towards the AI sector despite their significant market gains this year.
Market Performance and Concerns: Nvidia and Palantir have seen substantial increases in their stock prices, but recent premarket trading shows declines, prompting Burry to share charts that suggest a slowdown in cloud growth among major tech companies.
Cautionary Insights: Burry's social media posts reference historical market bubbles and caution investors against the current AI stock trends, likening his warnings to the character Cassandra from mythology.
Nvidia's Market Milestone: Nvidia recently became the first company to reach a $5 trillion market capitalization, reflecting its dominance in the AI hardware market, while Palantir continues to thrive through AI-driven contracts.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 186.940
Low
200.00
Averages
264.97
High
352.00
Current: 186.940
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Nvidia's Earnings Report to Signal Market Direction
- Market Concentration Analysis: RBC Wealth Management's Rob Sluymer highlights that the concentration of mega-cap tech stocks has significantly increased over the past few years, leading to investors being overweight in these stocks, which have now declined about 7% year-to-date.
- Nvidia Earnings Preview: Nvidia is set to report its fourth-quarter earnings on February 25, and Sluymer believes this will serve as a crucial market indicator; if the results fall short of expectations, it could trigger a larger correction in tech stocks.
- Investor Sentiment Shift: As attention on tech stocks rises, Sluymer notes that some funds are rotating out of these high-valuation stocks into other sectors, a typical behavior in times of high market concentration.
- Future Market Outlook: Should Nvidia's earnings report disappoint, it may lead to a decline in market confidence in tech stocks, potentially resulting in a broader market correction that could impact overall investment strategies.
See More
Nvidia Poised for Strong GPU Sales in China Again
- Massive Market Opportunity: Nvidia has negotiated a deal with the U.S. government to resume GPU sales to China, with CEO Jensen Huang estimating the Chinese market could generate up to $50 billion annually, significantly boosting the company's performance.
- Sales Recovery Expectations: Before the ban, Nvidia projected $8 billion in sales from China for Q2 FY 2025; if sales return to similar levels, GPU sales could exceed $30 billion, presenting substantial growth potential.
- Revenue Growth Forecast: Wall Street anticipates Nvidia's revenue will reach $326 billion for FY 2027, but given the surge in AI computing spending, actual revenue could hit $350 billion, further enhancing market confidence.
- Strong Profitability: If Nvidia achieves $350 billion in revenue while maintaining a 56% profit margin, it could generate $196 billion in profits, and with a reasonable 40x earnings valuation, the stock price could rise to $322, indicating a compelling investment opportunity.
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Recommendations for Hyper-Growth Tech Stocks
- Nvidia's Market Performance: Nvidia boasts a 67.87% average annual return over the past five years, continuously launching new chips amid the AI wave, which is expected to further solidify its leadership in the data center market and attract more investor interest.
- Palantir's Growth Potential: Palantir reported a 70% year-over-year revenue increase in Q4, with a 34% rise in customer count, and its 'Rule of 40' shows a remarkable 127% growth and profitability, indicating strong market appeal despite challenges in international expansion.
- MercadoLibre's Sustained Growth: MercadoLibre excels in e-commerce and fintech in Latin America, with 115 million unique buyers and a 39% year-over-year revenue increase in Q3, demonstrating robust growth potential in a competitive market.
- ETF Investment Opportunities: The Vanguard Information Technology ETF, featuring several 'Magnificent Seven' stocks, offers a quality growth investment channel, and while market volatility is a concern, long-term investors can still benefit significantly.
See More
Nvidia Continues to Grow as Semiconductor Giant
- Nvidia's Strong Performance: Nvidia boasts a five-year average annual return of 67.87%, reflecting its robust performance amid the AI wave, with future growth likely fueled by significant investments from major tech companies in AI infrastructure.
- Palantir's Rapid Growth: Palantir's fourth-quarter revenue surged 70% year-over-year, with a 34% increase in customer count, and its 'Rule of 40' metric jumped from 81% to 127%, indicating high profitability from sales, although international expansion is hindered by a talent shortage.
- MercadoLibre's E-commerce Potential: MercadoLibre serves 115 million unique buyers and 72 million monthly active fintech users in Latin America, achieving a 39% year-over-year revenue increase and marking its 27th consecutive quarter of over 30% revenue growth, despite facing competitive pressures.
- Vanguard ETF Investment Opportunity: The Vanguard Information Technology ETF includes over 300 growth stocks, providing a convenient investment avenue, although market volatility may lead to sharper pullbacks in fast-growing stocks, necessitating readiness for long-term investors.
See More
Four Hyper-Growth Tech Stocks to Buy in 2026
- Nvidia's Strong Performance: Nvidia has excelled in the AI wave with a five-year average annual return of 67.87%, and its forward P/E ratio of 24.3 is significantly lower than the five-year average of 37.4, indicating attractive stock pricing and future growth potential.
- Palantir's Rapid Growth: Palantir posted a 70% year-over-year revenue increase in Q4, with a 34% rise in customer count, and its 'Rule of 40' score surged from 81% to 127%, demonstrating high profitability per sales dollar, despite challenges in international expansion.
- MercadoLibre's Market Potential: MercadoLibre boasts 115 million unique buyers and a 39% year-over-year revenue growth in Q3, with a net profit margin of 5.7%, and while facing competitive pressures, its forward P/E of 31 suggests attractive pricing.
- Vanguard Tech ETF Investment Opportunity: The Vanguard Information Technology ETF includes several 'Magnificent Seven' stocks, offering exposure to over 300 growth stocks, and while market volatility is a concern, long-term investors can still benefit significantly.
See More
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- Earnings Miss: Kyndryl's Q3 fiscal 2026 report revealed adjusted earnings per share of $0.52 and sales of $3.86 billion, both falling short of analyst expectations of $0.60 and $3.91 billion, leading to a significant loss of investor confidence.
- Weak Sales Growth: Although Kyndryl Consult saw a 24% year-over-year sales increase, overall revenue still failed to meet expectations, indicating pressure in market competition that could affect future market share.
- Guidance Downgrade: The company revised its full-year free cash flow forecast down to between $325 million and $375 million, significantly lower than the previous $550 million estimate, while projecting a sales decline of 2% to 3%, indicating a trend of deteriorating performance.
- Investor Confidence Shaken: Following a 47.9% stock price drop over the past week, compared to a mere 1.4% decline in the S&P 500, the market sentiment reflects extreme pessimism regarding Kyndryl's future performance.
See More
Nvidia's Earnings Report to Signal Market Direction
- Market Concentration Analysis: RBC Wealth Management's Rob Sluymer highlights that the concentration of mega-cap tech stocks has significantly increased over the past few years, leading to investors being overweight in these stocks, which have now declined about 7% year-to-date.
- Nvidia Earnings Preview: Nvidia is set to report its fourth-quarter earnings on February 25, and Sluymer believes this will serve as a crucial market indicator; if the results fall short of expectations, it could trigger a larger correction in tech stocks.
- Investor Sentiment Shift: As attention on tech stocks rises, Sluymer notes that some funds are rotating out of these high-valuation stocks into other sectors, a typical behavior in times of high market concentration.
- Future Market Outlook: Should Nvidia's earnings report disappoint, it may lead to a decline in market confidence in tech stocks, potentially resulting in a broader market correction that could impact overall investment strategies.
See More
Nvidia Poised for Strong GPU Sales in China Again
- Massive Market Opportunity: Nvidia has negotiated a deal with the U.S. government to resume GPU sales to China, with CEO Jensen Huang estimating the Chinese market could generate up to $50 billion annually, significantly boosting the company's performance.
- Sales Recovery Expectations: Before the ban, Nvidia projected $8 billion in sales from China for Q2 FY 2025; if sales return to similar levels, GPU sales could exceed $30 billion, presenting substantial growth potential.
- Revenue Growth Forecast: Wall Street anticipates Nvidia's revenue will reach $326 billion for FY 2027, but given the surge in AI computing spending, actual revenue could hit $350 billion, further enhancing market confidence.
- Strong Profitability: If Nvidia achieves $350 billion in revenue while maintaining a 56% profit margin, it could generate $196 billion in profits, and with a reasonable 40x earnings valuation, the stock price could rise to $322, indicating a compelling investment opportunity.
See More
Recommendations for Hyper-Growth Tech Stocks
- Nvidia's Market Performance: Nvidia boasts a 67.87% average annual return over the past five years, continuously launching new chips amid the AI wave, which is expected to further solidify its leadership in the data center market and attract more investor interest.
- Palantir's Growth Potential: Palantir reported a 70% year-over-year revenue increase in Q4, with a 34% rise in customer count, and its 'Rule of 40' shows a remarkable 127% growth and profitability, indicating strong market appeal despite challenges in international expansion.
- MercadoLibre's Sustained Growth: MercadoLibre excels in e-commerce and fintech in Latin America, with 115 million unique buyers and a 39% year-over-year revenue increase in Q3, demonstrating robust growth potential in a competitive market.
- ETF Investment Opportunities: The Vanguard Information Technology ETF, featuring several 'Magnificent Seven' stocks, offers a quality growth investment channel, and while market volatility is a concern, long-term investors can still benefit significantly.
See More
Nvidia Continues to Grow as Semiconductor Giant
- Nvidia's Strong Performance: Nvidia boasts a five-year average annual return of 67.87%, reflecting its robust performance amid the AI wave, with future growth likely fueled by significant investments from major tech companies in AI infrastructure.
- Palantir's Rapid Growth: Palantir's fourth-quarter revenue surged 70% year-over-year, with a 34% increase in customer count, and its 'Rule of 40' metric jumped from 81% to 127%, indicating high profitability from sales, although international expansion is hindered by a talent shortage.
- MercadoLibre's E-commerce Potential: MercadoLibre serves 115 million unique buyers and 72 million monthly active fintech users in Latin America, achieving a 39% year-over-year revenue increase and marking its 27th consecutive quarter of over 30% revenue growth, despite facing competitive pressures.
- Vanguard ETF Investment Opportunity: The Vanguard Information Technology ETF includes over 300 growth stocks, providing a convenient investment avenue, although market volatility may lead to sharper pullbacks in fast-growing stocks, necessitating readiness for long-term investors.
See More
Four Hyper-Growth Tech Stocks to Buy in 2026
- Nvidia's Strong Performance: Nvidia has excelled in the AI wave with a five-year average annual return of 67.87%, and its forward P/E ratio of 24.3 is significantly lower than the five-year average of 37.4, indicating attractive stock pricing and future growth potential.
- Palantir's Rapid Growth: Palantir posted a 70% year-over-year revenue increase in Q4, with a 34% rise in customer count, and its 'Rule of 40' score surged from 81% to 127%, demonstrating high profitability per sales dollar, despite challenges in international expansion.
- MercadoLibre's Market Potential: MercadoLibre boasts 115 million unique buyers and a 39% year-over-year revenue growth in Q3, with a net profit margin of 5.7%, and while facing competitive pressures, its forward P/E of 31 suggests attractive pricing.
- Vanguard Tech ETF Investment Opportunity: The Vanguard Information Technology ETF includes several 'Magnificent Seven' stocks, offering exposure to over 300 growth stocks, and while market volatility is a concern, long-term investors can still benefit significantly.
See More
Kyndryl Stock Plummets 47.9% Amid Disappointing Earnings
- Earnings Miss: Kyndryl's Q3 fiscal 2026 report revealed adjusted earnings per share of $0.52 and sales of $3.86 billion, both falling short of analyst expectations of $0.60 and $3.91 billion, leading to a significant loss of investor confidence.
- Weak Sales Growth: Although Kyndryl Consult saw a 24% year-over-year sales increase, overall revenue still failed to meet expectations, indicating pressure in market competition that could affect future market share.
- Guidance Downgrade: The company revised its full-year free cash flow forecast down to between $325 million and $375 million, significantly lower than the previous $550 million estimate, while projecting a sales decline of 2% to 3%, indicating a trend of deteriorating performance.
- Investor Confidence Shaken: Following a 47.9% stock price drop over the past week, compared to a mere 1.4% decline in the S&P 500, the market sentiment reflects extreme pessimism regarding Kyndryl's future performance.
See More
