Michael Barry attends the New York screening of ‘The Big Short’ at the Ziegfeld Theater on November 23, 2015 in New York City.
Astrid Stawiarz | Getty Images
Michael Burry of “The Big Short” fame said Tuesday he has no role. space xquestioned the company’s nearly $3 trillion market value, but argued that the options used to bet on stocks remained too expensive.
The investor, best known for predicting the U.S. housing collapse before the financial crisis, said he considered several bearish options trades related to SpaceX, but ultimately passed on them all.
“I’m not currently involved with SpaceX. Not for a short time, and well, not a long time,” he said in a post on Substack on Tuesday.
A $100 put option expiring in December 2028 costs about $25 per contract, and the stock trades around $212, Burley said. A similar contract expiring in June 2027 costs about $13, while a December 2026 put trades for about $6.75.
“I was tempted by that, but thank you,” Berry said of the short-term option. “With any luck, SPCX will settle in the mid-$200s and volume will flow out of the put option chain.”
Still, Burley questioned the size of the company’s valuation, describing SpaceX as “basically a small space company, a niche communications company, an unscrupulous social media company, and a core weave light company with less than $20 billion in annual revenue.”
He argued that the company’s market capitalization has reached a level that dwarfs many existing businesses and properties, noting that SpaceX is now worth more than Warren Buffett. Berkshire Hathaway and exceeds the market value of many industries and national economies.
“Berkshire Hathaway reversed its stock price two and a half times in just three days. Berkshire Hathaway has painstakingly assembled two centuries of life, two of the greatest investors of our time,” Barry said.
space x
The comments add to the debate over whether investors are overvaluing SpaceX’s businesses, which span launch services, satellite internet and social media, following one of the most high-profile initial public offerings in recent years.
SpaceX stock soared 20% in the first full day of trading after the blockbuster debut, and has since risen more than 25% in the week to date. This historic IPO made Elon Musk the world’s first millionaire.
Barry last month urged investors to reduce their exposure to high-flying technology stocks, saying they should “reject greed” as enthusiasm for artificial intelligence and momentum trading has sent valuations soaring. He has been warning for months that the stock market’s obsession with AI increasingly resembles the final stages of the dot-com bubble.
