Michael Burry Reveals Stake in QXO, Inc., Stock Up 7.2%

NEW YORK, September 22, QXO, Inc. (QXO) jumped 7.2% to $12.2 after Scion Asset Management disclosed a stake in a business most of the covering commentary never actually described: a roofing, waterproofing, and siding distributor that sources asphalt shingles, TPO membranes, fiber-cement siding, and commercial waterproofing systems from manufacturers including GAF, Owens Corning, CertainTeed, and James Hardie, then delivers them to professional contractors, home builders, and building owners across the United States and Canada. Burry is not buying an abstraction, he is buying a middleman in fragmented building-products distribution, run by CEO Brad Jacobs, whom Jim Cramer publicly says he hesitates to bet against.

The numbers

• Shares gained 7.2% on the Scion disclosure; at $12.2, QXO trades at 18.9x forward P/E despite –$0.92 in trailing EPS
• TTM revenue hit $9.9bn, up 70.3% YoY, a rate that reflects acquisition-driven scale rather than organic roofing demand
• Free cash flow runs at –$2.5bn; the bull case requires this gap to close as integration catches up to deal pacing
• Next data point: Scion's next 13F will confirm whether the position was held, expanded, or trimmed before the move

A 13F Is Old News by Design

A 13F must be filed within 45 days of a calendar quarter's close. By the time a Scion disclosure reaches public view, Burry may have held the position for months, and investors buying that surge are purchasing the announcement, not the original thesis. That structural lag is not a flaw in the signal; it means the entry price that attracted Scion is no longer on the table.

70.3% Revenue Growth Reflects the Acquisition Pace, Not Roofing Demand

QXO's $9.9bn in TTM revenue grew 70.3% YoY. The company's own product breadth tells the story: it distributes across residential roofing (asphalt shingles, metal, tile, slate), commercial roofing (EPDM, PVC, TPO, low-slope metal), exterior siding (vinyl, aluminum, steel, fiber cement under LP SmartSide and James Hardie brands), and commercial waterproofing systems, a footprint that spans categories no single organic build-out achieves in a year. At 18.9x forward P/E on negative trailing earnings, buyers are paying for the premise that Jacobs converts this assembled roofing-and-waterproofing distribution network into a scaled, high-margin business. That is not a cheap bet. It is, at $12.2, the only bet available in this name.

Negative $2.5bn FCF Is the Bear's Best Argument

Free cash flow at –$2.5bn is not incidental; it is the core bear case. With trailing EPS at –$0.92, QXO is not earning its cost of capital today. The standard rebuttal is that FCF losses are a timing artifact of aggressive acquisition pacing and that margin expands once integration catches up to the deal pipeline. The number that would falsify Burry's thesis next quarter is an FCF loss that widens faster than revenue grows, evidence that the distribution network being assembled is dilutive rather than accretive to unit economics.

11.5% Short Float Adds a Mechanical Catalyst Independent of the Business

Burry entering a stock with 11.5% of the float sold short introduces short-covering pressure as a catalyst that operates independently of whether QXO's roofing distribution margins actually improve. If Scion's next 13F shows an expanded position, covering activity could push shares past levels the fundamentals support on their own. That move is the market pricing that scenario into the tape today.

For a full breakdown of QXO's valuation, revenue trajectory, and analyst estimates, generate a Basis Report for QXO or stress-test the forward assumptions with the DCF calculator.

Basis Report is independent research for informational purposes. It is not investment advice and not a recommendation to buy or sell any security.

Basis Report is independent research for informational purposes. It is not investment advice and not a recommendation to buy or sell any security.