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Holly LaFon
Holly LaFon
Articles (9746)  | Author's Website |

Dr. Michael Burry of 'The Big Short' Buys Alphabet and Sells Apple

'The Big Short' star goes opposite direction of Buffett

Dr. Michael Burry, one of the few to spot and short the housing market crash, began to show a trend of carving down his portfolio and traded one tech giant for another in the second quarter.

Burry was portrayed as a genius contrarian in the movie about the financial crisis of 2008, The Big Short. His new private investment firm, Scion Asset Management, began disclosing its buys and sells in the fourth quarter and showed that he owned some of the banks that teetered on collapse during that era. In the second quarter, he sold out of all his financial services stocks: Bank of America (NYSE:BAC), Citigroup (NYSE:C), Bank of New York Mellon (NYSE:BK) and PNC Financial Services Group (NYSE:PNC).

Over the past nine months, he has been selling much more than banks. He went from owning 13 stocks in the fourth quarter, to eight in the first, to six in the second.

He also chose to sell his stake in Apple (NASDAQ:AAPL), a stock Warren Buffett (Trades, Portfolio) chose to increase by roughly 50%. The sell is significant because Dr. Burry had the company as his second largest position in the previous quarter, with 75,000 shares.

A new stock has taken its place: Alphabet (NASDAQ:GOOG). He purchased 15,000 shares of the company, a stake valued at $10.4 million.

Burry also purchased NeoPhotonics Corp. (NYSE:NPTN) and more of Theravance Biopharma (NASDAQ:TBPH) during the quarter. He sold his holdings of Gentherm Inc. (NASDAQ:THRM), First Solar (NASDAQ:FSLR) and Tailored Brands (NYSE:TLRD).

Buys

Alphbaet Inc. (GOOGL)

Dr. Burry purchased 15,000 shares. The stock’s price for the quarter averaged $718 per share.

Alphabet Inc. has a market cap of $549.58 billion; its shares were traded around $799.65 with a P/E ratio of 31.01 and P/S ratio of 6.78. Alphabet Inc. had an annual average earnings growth of 22.4% over the past 10 years. GuruFocus rated Alphabet Inc. the business predictability rank of 3.5-star.

Theravance BioPharma (NASDAQ:TBPH)

Dr. Burry increased his stake by 18.2%. The stock’s price for the quarter averaged $22 per share.

Theravance Biopharma Inc. has a market cap of $1.33 billion; its shares were traded around $27.89 with and P/S ratio of 26.96.

NeoPhotonics Corp. (NYSE:NPTN)

Dr. Burry bought 300,000 shares. The stock’s price for the quarter averaged $11 per share.

Neophotonics Corp. has a market cap of $656.09 million; its shares were traded around $15.69 with a P/E ratio of 112.09 and P/S ratio of 1.80.

Sells

Gentherm Inc. (NASDAQ:THRM)

Dr. Burry sold out of 47,000 shares. The stock’s price averaged $38 per share.

Gentherm Inc. has a market cap of $1.15 billion; its shares were traded around $31.53 with a P/E ratio of 13.32 and P/S ratio of 1.31. Gentherm Inc. had an annual average earnings growth of 42.20% over the past 10 years. GuruFocus rated Gentherm Inc. the business predictability rank of 2.5-star.

Apple Inc. (NASDAQ:AAPL)

Dr. Burry sold 75,000 shares. The stock’s price averaged $99 per share.

Apple Inc. has a market cap of $589.28 billion; its shares were traded around $109.36 with a P/E ratio of 12.70 and P/S ratio of 2.79. The trailing 12-month dividend yield of Apple Inc. stocks is 1.99%. The forward dividend yield of Apple Inc. stocks is 2.09%. Apple Inc. had an annual average earnings growth of 49.2% over the past 10 years. GuruFocus rated Apple Inc. the business predictability rank of 4.5-star.

First Solar Inc. (NASDAQ:FSLR)

Dr. Burry sold 100,000 shares. The stock’s price averaged $53 per share.

First Solar Inc. has a market cap of $3.87 billion; its shares were traded around $37.80 with a P/E ratio of 5.55 and P/S ratio of 0.99. First Solar Inc. had an annual average earnings growth of 8.10% over the past five years.

Tailored Brands Inc. (NYSE:TLRD)

Dr. Burry sold 400,000 shares. The stock’s price averaged $15 per share.

Tailored Brands Inc. has a market cap of $709.240 million; its shares were traded around $14.58 with and P/S ratio of 0.19. The trailing 12-month dividend yield of Tailored Brands Inc. stocks is 4.92%. The forward dividend yield of Tailored Brands Inc. stocks is 5.07%.

See Dr. Michael Burry’s portfolio here. Start a free 7-day trial of Premium Membership to GuruFocus.

About the author:

Holly LaFon
I'm a financial journalist with a Master of Science in journalism from Medill at Northwestern University.

Visit Holly LaFon's Website


Rating: 5.0/5 (2 votes)

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Comments

culpel
Culpel premium member - 2 years ago

Holly - Is there a way to see how much cash he holds?

poetsvapor
Poetsvapor - 2 years ago    Report SPAM

When you look at his early 21st Century Scion Capital shareholder letters, his strategy has changed. Should I be surprised he bought Google . . . are they not “polished” up totally? Of course living in Cupertino, he’s surrounded by big and small tech-companies to his left and to his right, so God only knows what he sees from so high up. Now, NeoPhotonics does look like his classic “Road kill” with its low Earnings Power, too small ROC, higher WACC to ROIC and a beta of 1.65, indicating it can take a dip lower than the market when the market goes down.

Holly LaFon
Holly LaFon premium member - 2 years ago

@Culpel - I don't think there is a way to know that, unless you are one of his clients

ggman32
Ggman32 - 2 years ago    Report SPAM

It looks like he went significantly to cash or otherwise suffered significant redemptions, which I doubt given the time period (February to August).

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