The 'Big Short's' Michael Burry Has Seen His Largest Position Fall Over 50% This Year. Should Investors Sell the Stock?
Michael Burry's largest position, Lululemon (LULU), has fallen over 52% this year. The company reported Q2 revenue of $2.42B, missing estimates, and cut its full-year outlook. Gross margins increased 2% YoY to 60.5%. Analysts have mixed views, with some slashing price targets. Burry remains invested, citing strong margins and potential CEO changes.
How this was made
The 30-second read
Why it matters
Lululemon's earnings miss and guidance cut triggered a sharp intraday decline, raising questions about short‑term positioning.
Market read
The earnings surprise and guidance reduction are material for traders tracking consumer discretionary stocks.
What to watch
Tariff refunds and a potential strategic pivot under new leadership could mitigate downside.
Background
The article discusses Michael Burry's large position in Lululemon and the recent earnings disappointment.
Ticker impact
Lululemon reported Q2 earnings with revenue miss and cut full‑year guidance, causing the stock to fall over 17% intraday.
downside pressure, potential further decline toward $90‑$95 level
Earnings miss, revenue short of consensus, and a 5‑7% annual revenue decline signal weaker demand; analysts have slashed price targets.
Market effects
Athletic apparel sector may see broader pressure as Lululemon's slowdown hints at weaker consumer spending.
North American retail outlook weakened; Asian markets may see limited spillover.
Limited to consumer discretionary segment, but large‑cap status gives modest global relevance.
Counterpoint
If the stock rebounds below $100, it could become a value play given strong margins and a new CEO.
Key entities
- companyLululemon Athletica Inc.
Athletic apparel maker reporting Q2 results and guidance cut.
- individualMichael Burry
Investor with a large position in Lululemon.
