Michael Burry Sells FLUT To Pile Into LULU Under $100 — Plus A New Bet On ZTS

Michael Burry says Lululemon’s valuation has become increasingly attractive and sees Zoetis as “very cheap” despite the risk of further downside.

• Burry exited his Flutter position in full, citing relative valuation.
• He believes LULU’s management problems could make the company an acquisition target.
• He increased his Zoetis position "in the $72s," calling the stock “very cheap.”

“The Big Short” investor Michael Burry has sold his Flutter Entertainment Plc (FLUT) position in full and moved the majority of the proceeds into Lululemon Athletica Inc. (LULU), while also increasing his stake in Zoetis Inc. (ZTS).

Burry said Flutter was no longer as attractive relative to the valuations of other stocks, called Lululemon’s valuation increasingly “compressed,” and described Zoetis as “very cheap.”

At the time of writing on Friday, FLUT was trading 1.5% lower in after-hours trading after ending the regular session nearly 2% higher. LULU was up 0.09%, while ZTS was trading 0.3% higher.

Burry Exits FLUT, Moves Into LULU

Burry said he sold Flutter in its entirety because the stock was “not as attractive at this price relative to the valuations to which some other stocks have fallen.”

He said he then “piled the majority” of the proceeds into Lululemon under $100.

“I imagine LULU, as profitable as it is, and as compressed as its valuation has become, may not be public for very much longer,” Burry wrote in a post on Substack.

Burry stressed that he has “no information” that Lululemon could be taken private. However, he added that the company’s problems have “largely been due to bad management” and that he believes there are others that could “easily buy it and run it much better.”

“Hence, my urgency,” Burry added.

Burry Adds To ZTS, But Has A Warning

Burry also said he bought more Zoetis (ZTS) in the $72s, which he believes is “very cheap for this company.”

He said Zoetis is trying to “put in a base here on high volume,” but warned that the stock “may bleed lower.” 

FLUT, LULU, ZTS Stocks: Stocktwits Retail Sentiment

On Stocktwits, retail sentiment for LULU shifted to ‘neutral’ from ‘extremely bullish’ over the past 24 hours. Sentiment for FLUT remained ‘bearish,’ while ZTS stayed ‘extremely bearish,’ with neither changing over the same period.

Message volume for LULU was ‘normal,’ while it was ‘low’ for both FLUT and ZTS.

Year-to-date, FLUT has declined nearly 54%, LULU has lost more than 52%, and ZTS is down more than 42%. 

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