Ah, Jim Chanos. The maestro of the short-selling symphony, a man whose intuition for betting against bloated behemoths has earned him the reverence (and perhaps the envy) of Wall Street’s most seasoned sharks. His latest disclosure? A list of companies so overhyped, they make the Dot-com bubble look like a modest speck of lint.
At the 2025 Forbes Iconoclast Summit, Chanos shared his thoughts on the darlings of the market that are doomed to crash under the weight of progress. And guess who’s in the crosshairs? None other than the tech grandpapa, International Business Machines (IBM). Ah yes, the same IBM that was once the epitome of corporate might—now clinging to life like a broken-down dinosaur trying to survive in the AI era.
“We think there’s a number of companies that kind of pop up that are going to be roadkill on the AI highway. And right now, similar to the early part and mid part of the Dot-com boom, all the stocks are getting inflated,” Chanos muses. Yes, inflation—but not of the kind that makes your grocery bill spike. We’re talking about stock prices as ridiculous as a gold-plated toilet.
“There are a lot of companies whose business models, if you think it through, will see them dramatically deflate because of AI,” he continues, offering a delightful bit of prophetic doom. And who’s topping his short list? None other than IBM, which, despite its recent 100% surge, is still a shadow of its former self. “It’s trading back at all-time high valuations, but it’s not growing,” he warns.
To make things clearer: IBM is currently selling at $268—a glorious 60% jump in the last 12 months. But don’t let that fool you. Chanos is certain that this is nothing more than an illusion, a brief shimmer before the inevitable plummet.
Now, if that wasn’t enough, Chanos has another juicy target in his crosshairs: Carvana, the online used car juggernaut that’s more inflated than a Michelin tire after a high-speed chase. The company has soared an absurd 7,961% in just 30 months—yes, you read that right—since its January 2023 price of $4.23. No, this is not a typo.
“We think that [Carvana] is still a misunderstood story,” Chanos explains, shaking his head in disbelief.
“What really caught our eye and made it timely is a couple of positioning aspects, which these days, on the short side, are really important. Number one, the short interest is back down to multi-year lows, from being one of the most heavily shorted stocks in the market in 2023, it’s now back below and back toward its pre-Covid levels of short interest as percentage shares outstanding, below 10%.” Ah, the fickle whims of Wall Street—today’s darling is tomorrow’s disaster.
And here comes the kicker. Chanos gets a twinkle in his eye when he talks about insiders, the sneaky little devils who know the inside scoop before everyone else. “But perhaps even more ominous is that the insiders have begun to sell in an absolute torrent of stock…” The executives are apparently trying to escape the sinking ship before it hits the iceberg. Nothing says “confidence” like a bunch of people running for the exits.
At the time of writing, Carvana’s stock is trading at $341. The question is, how long can it keep up this charade?
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2025-06-07 10:21