Michael Burry, the investor who predicted the 2008 housing market collapse, stated on Monday that current market conditions have been ridiculous for a very long time. The post on X arrives as investor enthusiasm builds across artificial intelligence, technology stocks and SpaceX's historic public market debut.

Burry's comment follows earlier warnings this year where he compared the semiconductor sector to the dot-com era. He has previously cautioned on the housing bubble, meme-stock frenzy, passive investing and elevated equity valuations.

The market optimism is driven by a surge in AI leaders such as Nvidia Corp, Microsoft Corp, Meta Platforms Inc and Alphabet Inc. These companies have added billions in market value as investors bet on AI transforming industries.

SpaceX made its public market debut on Friday, raising $75 billion by selling 555.6 million shares at $135 each. The stock opened at $150 and reached an intraday high of $176.52.

SpaceX IPO Details

Other investors have echoed Burry's caution. Bridgewater Associates founder Ray Dalio has warned that AI enthusiasm resembles previous periods of technological euphoria. Steve Eisman, another investor famed for the "Big Short", expressed concern about the sustainability of the rally.

Burry rose to prominence by profiting from the collapse of the U.S. housing market before the 2008 financial crisis. He remains a closely watched contrarian investor, frequently warning about asset bubbles and speculative excesses.

SpaceX gained 19.6% on Monday to $192.50 and rose a further 3.49% in after-market trading.

Michael Burry, the investor known for betting against market bubbles, is capitalizing on the recent tech selloff by accumulating shares in beaten-down companies he views as bargains. Despite his previous warnings about an AI bubble and his bearish positions on Palantir and Nvidia, Burry has increased his stakes in Alibaba, Adobe, PayPal, and Veeva Systems. This shift highlights a strategy of finding value in distressed assets while maintaining skepticism about overhyped sectors.

Alibaba

Burry added to his position in Alibaba, whose American Depositary Receipt (ADR) has dropped by over 40% from its highest point last year. The stock faced additional pressure in May following a sharp decline in reported profitability as the company increased AI investments. Burry views Alibaba as the most advanced AI company in China and notes its ongoing share repurchase program. Data indicates the US ADR outstanding shares have decreased to 2.32 billion from 2.78 billion in 2021. In contrast, Amazon, its American equivalent, has seen its market capitalization soar to $2.56 trillion.

PayPal

PayPal shares have fallen significantly from $300 in 2021 to $41. Burry attributes this underperformance to slowing revenue growth, increased profitability concerns, and CEO turnover. He believes PayPal's popular brand and low valuation could make it an acquisition target, citing reports that Stripe considered a bid earlier this year. Burry remarked, "The market has been attending PayPal's wake for years now, though the body has yet to show."

Adobe

Adobe, another stock Burry is adding to, has crashed from $700 in 2021 to $204. The sell-off accelerated recently after the company announced its CFO was leaving. Despite the "SaaSPocalypse" concerns and competition, Adobe's gross margin reached a record high. Analysts expect annual revenue growth of 11% this year and 10% in 2027.

Veeva Systems

Veeva Systems, which focuses on the life sciences industry, has become a bargain as investors price in competition from Salesforce. Burry finds its multiples attractive, particularly with a forward PE ratio of 17.83, lower than the S&P 500 Index's 22. He anticipates the next bull run in the software industry will benefit Veeva.