Michael Burry says he's shorting Caterpillar for the first time after it nearly doubled in the AI-driven rally of 2026

Michael Burry, the investor famous for his 2008 subprime short, has publicly disclosed a short position in Caterpillar (CAT) — his first-ever short on the name. He noted that CAT has nearly doubled in the 2026 AI-driven infrastructure rally, calling the valuation stretch his trigger. Burry's comment that he'd 'always done great on the long side' with CAT underlines that this is a valuation/timing call, not a fundamental business bear case.

Caterpillar's latest reported numbers show $67.6B in revenue, up 4.3% YoY, with a 13.1% net margin and $18.81 diluted EPS for FY2025. Those are solid, not spectacular, numbers — the kind that can support a good business but struggle to justify a stock that has nearly doubled in 12 months purely on macro sentiment.

The bull case is straightforward: AI data center buildouts, grid infrastructure upgrades, and reshoring capex are genuine multi-year demand drivers for heavy equipment, and CAT is the primary U.S. beneficiary of that cycle. Revenue is still growing and margins are healthy. The bear case, which Burry is betting on, is that the stock has priced in years of this cycle already — a near-doubling implies a significant valuation premium has been layered onto what remains a cyclical industrial.

The key tension is whether the AI infrastructure build is a durable enough cycle to justify the re-rating, or whether CAT is now a momentum overshoot vulnerable to any slowdown in capex, a macro turn, or simply mean-reversion to historical industrial multiples. Burry's track record on high-profile shorts is mixed post-2008, which is itself a risk to the trade. Watch for the next CAT earnings print and any softening in construction or mining equipment orders as the near-term catalyst.