Michael Burry, the investor best known for his bet against the 2008 housing market, has refreshed his bearish position against Palantir Technologies, buying new put options expiring in March 2027 with strikes in the low-to-mid $100 range. The move comes after Burry had partially covered an earlier short near $107, and it reasserts one of Wall Street's most aggressive contrarian calls against a stock that has been a centerpiece of the AI trading boom.
Burry's target is stark: he has said Palantir is "intrinsically worth under $1 in the long run," a valuation that stands in almost total isolation from where the stock actually trades, near 69 times sales by his own calculation.
The Case Against Palantir
Burry laid out his reasoning in his Cassandra Unchained research letter, pointing to two specific mechanics he argues are masking the company's true cost structure. First, Palantir issued 31.3 million shares to staff over the past year, worth roughly $5 billion — about six times the company's reported stock-based compensation expense, which Burry has called the widest accounting gap among the 66 companies he tracks. Second, he flagged that Palantir's off-balance-sheet, non-cancellable infrastructure purchase commitments have more than tripled over the past year, obligations he argues understate the capital intensity behind the company's AI platform growth.
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Betting Against a Squeeze
The renewed short comes at an awkward moment for bears. Palantir's stock has been on a tear following strong quarterly results driven by demand for its AI Platform (AIP) across both commercial and government customers, a rally that has squeezed short sellers broadly as AI-linked valuations have pushed to extremes across the market. Burry's decision to add to, rather than retreat from, his position signals he views the current strength as a valuation bubble rather than a fundamentals story — a wager that has so far cost him paper losses as the stock has continued to climb through the options' current strike range.
Palantir has not publicly responded to Burry's latest report. The March 2027 expiration gives the trade well over a year to play out, a timeline that will test whether Burry's accounting concerns eventually catch up with the stock or whether AI-driven enterprise demand keeps outrunning them.
