3 Hong Kong AI Stocks to Buy Now If You Want to Invest Like Michael Burry

Legendary investor Michael Burry, best known for predicting the 2008 financial crisis, recently suggested that now is "a particularly good time" to look for undervalued Hong Kong stocks as investors rotate away from expensive AI hardware names. His comments have renewed interest in China's internet giants, many of which are trading well below previous highs despite making aggressive investments in artificial intelligence (AI).

Among the most compelling opportunities are JD.com (JD), Alibaba Group Holding Limited (BABA), and Tencent Holdings Limited (TCEHY). Together, these companies rank among the largest technology constituents of the Hang Seng Index ($HSI) and are increasingly positioning themselves as long-term AI leaders rather than simply e-commerce or social media companies.

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He recently increased his stake in JD.com and argues that investors should look to Hong Kong as enthusiasm for markets like South Korea, Japan, and semiconductor stocks begins to fade. However, despite growing optimism from firms like Morgan Stanley (MS), the Hang Seng Index has declined this year, with major Chinese technology companies also posting year-to-date (YTD) losses. Given this backdrop, the above-mentioned stocks could be prominent additions to unlock solid gains in the long term.

Based in Beijing, China, JD.com, Inc. is one of the country's largest supply chain-based technology and e-commerce companies, operating a nationwide logistics network while offering retail, logistics, healthcare, and technology services. The company has a market cap of $38.2 billion.

JD shares have declined 8.9% over the past 52 weeks but up 6.1% YTD, compared to the Hang Seng Index, which has increased marginally 0.55% over the past year but is down 1.94% this year. Also, in comparison, the S&P 500 Index ($SPX) delivered 19.1% returns over the past year and 9.7% gains this year.

The recent weakness has caused the stock to trade at a discount. The stock trades at 10.65 times price-to-earnings, which is below the sector median and its own five-year average.

JD.com reported its first-quarter 2026 results on May 12, with revenue rising 4.9% year-over-year (YOY) to RMB315.7 billion ($45.8 billion). Growth was driven by a 20.6% YOY increase in net service revenue, including a 21.7% rise in logistics and other service revenue and an 18.8% increase in marketplace and marketing revenue, highlighting the continued expansion of JD's higher-margin businesses. General merchandise revenue climbed 14.9% YOY, while annual active customers reached a record high.

However, net income attributable to shareholders declined, with non-GAAP EPS falling to RMB5.12 per ADS ($0.74) from RMB8.41, reflecting increased spending on new strategic initiatives.

Analysts remain constructive on JD.com's long-term outlook, supported by its dominant logistics infrastructure, expanding AI-enabled retail capabilities, and continued investment in new growth initiatives, even as near-term profitability is pressured by strategic spending. Its earnings are expected to reach $2.78 per share in 2026, up 30.5% from the prior year and $3.33 per share in 2027, up 19.8% YOY.

Wall Street's outlook on the stock is optimistic, with a consensus "Strong Buy" rating overall. Of 23 analysts covering the stock, 19 recommend a "Strong Buy," two opt for a "Moderate Buy," one advises a "Hold," and one suggests a "Moderate Sell."

The average analyst price target of $40.12 indicates potential upside of 32% from the current price levels. The Street-high price target of $49 suggests that JD could rally as much as 61.1% from here.

Based in Hangzhou, China, Alibaba Group Holding Limited is one of the world's largest technology companies, operating leading e-commerce marketplaces, cloud computing services, digital payments, logistics, and artificial intelligence platforms. The company's market cap stands at $288.46 billion.

Alibaba shares have lost marginally 1.78% over the past 52 weeks and are down 19.41% YTD, significantly underperforming both the Hang Seng Index and S&P 500 Index this year.

Despite the pullback, the stock is trading at a higher valuation compared to its industry peers at 18.31 times forward price-to-earnings.