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‘Big Short’ Michael Burry dumps all his stocks except one; Here’s why

‘Big Short’ Micheal Burry dumps all his stocks except one; Here's why

Michael Burry’s fame reached an apex with his prescient call on mortgage-backed securities and the housing market crash in 2008 and 2009 market blowup. 

Since then, Burry has started managing his own private investment company, Scion Asset Management, whose 13F’s are often tracked with much fanfare. The 13F filing his company made on August 15 after the market closed did not disappoint investors that have a knack for the dramatic.

Namely, the filing showed that Burry sold everything he owned a quarter ago, including Warner Bros. Discovery (NYSE: WBD), Meta Platforms (NASDAQ: META), and Alphabet (NASDAQ: GOOG, GOOGL). Furthermore, the filing showed that he kept only one stock, The GEO Group, Inc. (NYSE: GEO), a prison operator. 

Notable market participants, such as Welt’s Holger Zschaepitz, took to Twitter to spread the news of Burry’s dramatic market moves.

“Big Short’ investor Michael Burry dumps stock portfolio after market crash warnings to just 1: private-prison operator Geo Group. Scion sold off its long positions on 11 comps during Q2, incl bullish bets on Alphabet, Meta, Bristol-Meyers Squibb & Nexstar.”

Scion Asset Management 13F. Source: Twitter 

GEO chart and analysis

In the last month, GEO has been trading in the $6.40 to $7.95 range, and it’s currently trading near the high of this range. Volume is considerably higher in the last couple of days, with both the short-term and long-term trends positive.

Technical analysis shows a support zone between $6.76 and $6.95, while the resistance line is at $8.03.   

GEO 20-50-200 SMA lines chart. Source. data. See more stocks here.

A single TipRanks analyst rates the shares as a ‘moderate buy,’ predicting that the average 12-month price could reach $15.00, 97.37% higher than the current trading price of $7.60.

Wall Street analysts’ price targets for GEO. Source: TipRanks

After looking at the 13F, it is difficult to conclude that GEO could be a company with a more favorable risk-to-reward ratio compared to some big names like META and GOOGL. Yet, on the other hand, Burry does have a track record of finding valuable companies from which he extracts value as an asset manager. 

Only time will tell whether he is correct again, and if he is, it will generate even more excitement for the upcoming 13F filings. 

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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

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