“Kynikos Associates founder and legendary short-seller Jim Chanos is revealing the companies he believes are prime for shorting.
In a new interview at the 2025 Forbes Iconoclast Summit, Chanos says companies that are likely to fade away due to artificial intelligence (AI) advancements top his short list, including US computer giant International Business Machines Corporation (IBM).
“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.
But there are a lot of companies who have business models that, if you think it through, are going to see them dramatically deflate because of the capabilities of AI as AI gets better and better. We call them either body shops or AI products that will basically be competed away…
I’m not going to give you a bunch of names, but one of our old names that is in that group that we’ve been short on and off since 2020 has been the IBM, which has been a good stock in the last year and a half. It’s basically doubled, and after going down for 10 years. But it’s trading back at all-time high valuations. It’s not growing. It’s a body shop…
We think it’s a business that’s going to continue to melt away, not right away, but AI will continue to hurt IT consultants and IT body shops.”
IBM is trading for $268 at time of writing, up about 60% in the last 12 months.
Another company on Chanos’ short list is used car retailer Carvana (CVNA), which is up 7,961% in the last 30 months after trading at $4.23 in January 2023.
“We think that [Carvana is] still a misunderstood story…
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%.
But perhaps even more ominous is that the insiders have begun to sell in an absolute torrent of stock… It’s pretty much the C-suite are getting out seemingly as fast as they can.”
Carvana is trading at $341 at time of writing.
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