Remember GameStop? The video game retailer that broke the internet in 2021 when Reddit traders sent it to the moon and made hedge funds cry?
Well, it’s back in the headlines. And this time, it’s because of Michael Burry.
Who’s Michael Burry again?
If you’ve watched “The Big Short,” you know him as the guy played by Christian Bale—the brilliant, eccentric investor who bet against the U.S. housing market before the 2008 crash and made a fortune.
On Monday, Burry revealed on his Substack that he’s been buying GameStop shares recently. The stock immediately rallied, jumping as much as 8.8% before settling around 4-6% higher.
But here’s what makes this interesting: Burry isn’t betting on another meme stock explosion. He’s making a long-term value bet.
What’s the play?
Burry said he expects to be buying at roughly 1x tangible book value—basically, he’s paying about what the company’s assets are worth on paper. In today’s overheated stock market, that’s rare.
GameStop is sitting on approximately $8.8 billion in cash with $4.4 billion in interest-free debt. Under CEO Ryan Cohen (the guy who founded Chewy, the online pet supply company), the company has been systematically closing underperforming stores and raising cash through strategic equity offerings.
Burry’s bet isn’t on GameStop becoming a thriving video game retailer again. It’s on Cohen using that massive cash pile intelligently—maybe acquiring a profitable business, maybe something else. Burry wrote that Cohen is “making lemonade out of lemons” and “milking” the legacy business while waiting to make a strategic acquisition.
Not about the squeeze
Here’s what Burry explicitly said: “I am not counting on a short squeeze to realize long-term value”.
Translation: This isn’t 2021 all over again. He’s not banking on Reddit traders to send the stock parabolic. He’s betting on fundamentals—specifically, on Cohen’s ability to deploy billions of dollars wisely over the next few decades.
Burry believes in Ryan Cohen’s leadership and is willing to hold for the long term. He even noted his willingness to be patient despite being fifteen years older than Cohen.
The market reaction
Trading volumes in GameStop exploded after the news dropped. Call options surged, with traders piling into short-term bets that the stock would keep rising.
But unlike the 2021 frenzy, this rally didn’t spill over to other meme stocks like AMC and Koss. This was a Burry-specific pump, not a full-blown meme stock revival.
The irony
Here’s the kicker: Burry actually owned GameStop back in 2019-2020. He bought around 3 million shares at roughly $3.32 each. But he sold in late 2020—just weeks before the January 2021 short squeeze sent the stock to nearly $500.
He missed a potential billion-dollar windfall.
Now he’s back. And this time, he’s buying at around $24 per share—still 72% below the stock’s 2021 peak.
Why this matters
GameStop has been a punchline for years. It’s the poster child of meme stock mania, retail trading chaos, and market irrationality.
But Burry’s bet reframes the story. He’s not treating GameStop as a joke or a lottery ticket. He’s treating it as a cheap stock with downside protection (thanks to its cash pile) and upside optionality (thanks to Cohen’s potential moves).
Whether he’s right or wrong, it’s a reminder that even in the age of memes and viral trading, some investors are still hunting for old-school value plays.
And sometimes, those value plays happen to be the most infamous meme stocks of all time.
Sonia Boolchandani is a seasoned financial writer She has written for prominent firms like Vested Finance, and Finology, where she has crafted content that simplifies complex financial concepts for diverse audiences.
Disclosure: The writer and her his dependents do not hold the stocks discussed in this article.
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