Michael Burry and his investment in three stocks with great potential

Michael Burry continues to buy shares of Chinese technology companies. The move has attracted attention not only among investment experts but also the general public, who are asking what is behind his decision at a time when relations between the US and China are not at all rosy.

Burry, founder of the Scion Asset Management fund, has decided to increase his positions in several Chinese tech giants in recent months. What are the 3 companies in question?

JD.com $JD: E-commerce leader with big potential

JD.com is one of the biggest players in the Chinese e-commerce field, competing with such giants as Alibaba. The company not only focuses on online sales, but also on logistics, which makes it unique compared to other online marketplaces. JD.com has invested heavily in its own delivery network in recent years, allowing it to provide fast and efficient delivery even in less developed areas of China. This growth in logistics can bring huge benefits to the company in the long term, as e-commerce increasingly becomes the norm not only in urban areas but also in less urbanised regions.

In the third quarter of 2024, Burry increased its stake in JD.com by 100%, raising its share count to 500,000 shares, representing an investment value of approximately $20 million. While JD.com is on the front lines of Chinese e-commerce, its strong business model focused on logistics and integrating technology into its store, such as artificial intelligence to optimize inventory, gives the company room for continued growth. Although the Chinese economy is currently facing challenges, JD.com has a firmly established market position, which should allow it to show steady growth in the long term.

Baidu $BIDU: Artificial intelligence and internet search engine in one

Baidu is considered the "Chinese Google" and dominates search in the Chinese market. However, Baidu is not just a search engine, but a company that is aggressively focusing on new technology areas such as artificial intelligence, autonomous vehicles and cloud computing. This gives it ample room to grow not only domestically, but also in international markets that increasingly demand advanced technology solutions. In the field of AI, Baidu has established itself as a leader and is also developing its own autonomous vehicles, which may be the future of the entire automotive industry.

Burry increased its stake in Baidu by 67%, bringing the number of shares to 125,000, an investment worth approximately $13.2 million. This investment shows his belief in the long-term potential of the company. Despite competition from global tech giants such as Google and Amazon, Baidu has benefited from the Chinese government's support for technological development and has a strong position in the domestic market. If the firm can successfully expand into areas such as autonomous vehicles and AI, it could become one of the biggest technology leaders in the region.

Alibaba $BABA: An e-commerce giant with diversified operations

Alibaba, known for its dominance in e-commerce, has become much more than just an online marketplace in recent years. The company has expanded into other areas, including cloud computing, digital payments and logistics services. Its Alibaba Cloud division is the second largest cloud service provider in China and is growing faster than Amazon Web Services in the Chinese market. Alibaba is also a big player in digital payments with its Alipay platform, which has more than 1 billion active users. This ecosystem, which combines e-commerce, cloud computing, financial technology and logistics, provides Alibaba with a solid foundation for growth even in difficult times.

Burry increased its stake in Alibaba by 29% this year, meaning it now owns 200,000 shares worth more than $21 million. Alibaba continues to show strong growth despite the political and economic problems in China, and its diversified business model allows it to minimize the risks associated with any particular area. Although it faces negative sentiment regarding government regulations and geopolitical pressures, Alibaba's long-term prospects remain positive, particularly due to its position in the cloud and fintech sectors.

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