Michael Burry Shorts Caterpillar for First Time After AI Rally
The 'Big Short' investor is betting against Caterpillar after the stock nearly doubled in an AI-driven rally, marking his first-ever short position on the equipment giant.
Michael Burry, the investor immortalized for predicting the 2008 mortgage collapse, has taken an unusual and personally historic bet: shorting Caterpillar for the first time in his career. The heavy-equipment maker had long been a profitable long-side trade for Burry, making his decision to reverse course a notable signal about where he believes the stock's extraordinary run may be headed.
Caterpillar's shares nearly doubled during the AI-driven rally of 2026, a surge that Burry apparently views as a valuation stretch rather than a reflection of underlying fundamentals. While AI infrastructure buildouts have generated genuine demand for construction and industrial equipment, the scale of the price appreciation appears to have caught Burry's contrarian eye in a way previous rallies did not.
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"Caterpillar jumped out at me," Burry said in his characteristic terse fashion. "I have never shorted Caterpillar. It has always done great for me on the long side in the past." That candid admission underscores how significant the setup must appear to him — Burry is not a trader who abandons a winning playbook lightly, and publicly disclosing a short position adds reputational risk to financial risk.
The move invites broader questions about the durability of the AI-infrastructure trade. Caterpillar's rally was partly predicated on the assumption that data center construction and energy grid expansion would sustain elevated demand for industrial machinery well into the future. Burry's short suggests he may believe markets have priced in that optimism too aggressively, or that a cyclical slowdown in capital expenditures could materially dent earnings before the market adjusts.
For retail and institutional investors alike, Burry's positioning is worth monitoring — not as a trading signal to blindly follow, but as a data point from one of the more disciplined macro-oriented short sellers operating today. His track record of identifying structural disconnects between price and value commands attention even when, as often happens, timing remains uncertain. Continue reading at US Top News and Analysis.
