Non Cult Crypto News

Non Cult Crypto News

in ,

MicroStrategy’s $42B Bitcoin bet is bullish for shareholders: Analyst

One analyst raised his price target from $245 to $300 per share on news of MicroStrategy’s bold Bitcoin buying plans. 

COINTELEGRAPH IN YOUR SOCIAL FEED

MicroStrategy’s ambitious goal of buying $42 billion worth of Bitcoin (BTC) by 2027 could be a winner for shareholders, according to an Oct. 31 analyst report shared with Cointelegraph.

During MicroStrategy’s Oct. 30 earnings call, the company tipped plans to raise $21 billion in equity and another $21 billion in debt to fund a three-year, multibillion-dollar BTC buying spree dubbed the “21/21 Plan.”

“If there were any doubts that MicroStrategy (MSTR) would lean into its Bitcoin acquisition strategy amid a rising Bitcoin market, they were dispelled” by the Oct. 30 announcement, Benchmark fintech analyst Mark Palmer told Cointelegraph in an email.

Source: MicroStrategy

Related: MicroStrategy set for gains; ‘don’t fear the premium,’ analyst says

Palmer predicts MSTR stock could be worth $300 if MicroStrategy follows through on the 21/21 Plan.

He raised his price target for MSTR from his previous estimate of $245, which is now close to MSTR’s current trading price as of Oct. 31.

Palmer’s model assumes continued price appreciation for Bitcoin, which he expects to hit $175,000 by the end of 2025.

“MSTR enters this new, even more audacious phase in the execution of its strategy having assembled an impressive track record over the past four-plus years,” Palmer said in the analyst report.

Source: MicroStrategy

During its Aug. 1 earnings call, MicroStrategy doubled down on BTC buying by committing to a unique performance metric: Bitcoin yield.

Bitcoin yield measures the ratio of BTC holdings to outstanding shares and effectively sets BTC-per-share as a lodestar for corporate performance.

“While many investors have been focused on MSTR’s market capitalization relative to its [net asset value], we believe a more valuable metric for assessing the company’s value is its BTC Yield,” Palmer said.

As of September, MicroStrategy held more than 250,000 BTC, worth more than $17 billion as of Oct. 31.

Meanwhile, the total market capitalization of MSTR shares stands at approximately $42 billion, according to Yahoo Finance. 

“[M]anagement raised their annual target for MSTR’s BTC Yield for each of the next three years from 4-6% to 6-10% to reflect the expected impact of the “21/21 Plan,” Palmer said.

On Sept. 24, Palmer said MicroStrategy should consider a plan to start generating yield “by lending out a portion of its Bitcoin holdings.” 

Magazine: How the digital yuan could change the world… for better or worse

This article first appeared at Cointelegraph.com News

What do you think?

Written by Outside Source

Former FTX’s Head of Engineering Nishad Singh Dodges Prison

‘Crypto is not going anywhere’ — Florida chief financial officer

Back to Top

Ad Blocker Detected!

We've detected an Ad Blocker on your system. Please consider disabling it for Non Cult Crypto News.

How to disable? Refresh

Log In

Or with username:

Forgot password?

Don't have an account? Register

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

To use social login you have to agree with the storage and handling of your data by this website.

Add to Collection

No Collections

Here you'll find all collections you've created before.