"The Big Short" investor Michael Burry questioned Tesla's valuation in a weekend blog post. The post is critical of Tesla and the technology industry as a whole for its use of stock-based compensation and then ignoring it as a legitimate expense. Burry said Tesla share dilution should continue following shareholder approval of CEO Elon Musk's historic pay package. In this article Michael Burry questioned Tesla 's valuation as the investor of "The Big Short" fame took aim at the practice of technology companies issuing tons of stock-based compensation and excluding it from earnings results. The investor argues that when accounting for the true profits that include the cost of this compensation and its negative dilution of the company's value over time, companies like Tesla should have lower valuations. "Tesla's market capitalization is ridiculously overvalued today and has been for a good long time," Burry, who rose to fame for his call on a housing market bubble in the 2000s, wrote to subscribers of his new paid Substack. Burry pointed out that Tesla dilutes shareholders at a rate of 3.6% each year and doesn't offer buybacks. He posted a chart with subscribers that he said "shows the kind of present value destruction that this level of dilution can impart." He said the vote to accept Musk's $1 trillion compensation plan means investors should expect to get diluted further — meaning that that these additional shares water down their ownership of the company. The package had 75% approval among voting shares, despite proxy advisors Glass Lewis and ISS coming out against it. "With recent news of Elon Musk's $1 trillion dollar pay package, dilution is certain to continue," Burry wrote. Stock chart icon