Tesla overvalued and diluting shareholders, ‘Big Short’ investor Burry says

Elon Musk’s Tesla has taken a hit from investor Michael Burry, who claimed the electric car maker is “ridiculously overvalued” just days after it expressed concern about the artificial intelligence boom in the market.

“Tesla’s market cap is ridiculously overvalued today and has been so for a long time,” Puri wrote in his Substack newsletter “Cassandra Unchained” on Sunday.

Puri also calculated that Tesla dilutes current shareholders’ stakes by about 3.6% annually through continued stock issuance and the absence of buybacks. He added that Musk’s massive compensation plan would add to that dilution.

Last month, Tesla shareholders voted to approve Musk’s $1 trillion pay package — the largest executive compensation plan ever. Under the plan, Musk would receive up to about 12% of Tesla shares, subject to restrictions, worth about $1 trillion if the company reaches a market value of $8.5 trillion and achieves other performance milestones over 10 years. As of late November 2025, Tesla’s market cap is about $1.43 trillion — making it the world’s most valuable automaker and more than five times Toyota’s roughly $260 billion valuation — while CEO Elon Musk owns about 13% of the company’s outstanding shares.

Musk predicts that “money will cease to matter in the future” as artificial intelligence and robotics advance

The revised compensation plan followed a Delaware judge’s decision in January 2024 to void Musk’s previous $56 billion pay package, which remains the subject of ongoing litigation.

As of Monday afternoon, Tesla shares were trading at around $427-$430, a slight decline from the previous session. Over the past year, Tesla’s stock price has risen sharply, reflecting investor optimism about its growth plans, although it remains below its 52-week high.

Tesla did not respond to Fox News Digital’s request for comment.

Perry rose to fame after correctly predicting the US housing market crash of 2007-2008, a bet he executed through controversial early short positions against mortgage securities.

His insight was later immortalized in Michael Lewis’s “The Big Short” and his Oscar-winning film, cementing his reputation as one of Wall Street’s most famous contrarian investors.

Reuters also reported that Puri recently increased his criticism of tech giants like Nvidia and Palantir, “questioning the cloud infrastructure boom and accusing major providers of using aggressive accounting to inflate profits from their massive hardware investments.”

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On the contrary, Musk said in a new interview on Sunday that he believes robotics and artificial intelligence will be necessary to solve the country’s national debt of more than $38 trillion.

“I think this is the only thing that will solve the US debt crisis, because US debt is currently insanely high,” Musk said. “Interest payments on the debt exceed the entire U.S. military budget — just the interest payments, and that at least in the short term will continue to increase.”

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FOX Business’ Eric Revell contributed to this report.