MicroStrategy: Attempting A High-Stakes Play In Speculative Finance

Cavenagh Research
9.48K Followers

Summary

  • MicroStrategy's stock is highly risky due to its heavy reliance on Bitcoin, exposing it to extreme volatility and regulatory uncertainties.
  • The company's business model has shifted from business software to a Bitcoin investment vehicle, leveraging convertible bonds and equity offerings.
  • MicroStrategy's "BTC Yield" measures growth in Bitcoin holdings per share, with a YTD yield of 17% and a long-term target of 6%-10% annually.
  • MicroStrategy stock is currently trading at $87.2 billion market cap, vs. an estimated fair value of its Bitcoin holdings of approximately $43.5 billion.
Crypto currency and digital wallets concept background. Futuristic bitcoin icon in world of technological progress and innovation. CGI 3D render

da-kuk

In my view, MicroStrategy (NASDAQ:MSTR) stock may be the most overhyped equity asset of the ongoing bull market. YTD, shares have returned 422% while the market cap of MicroStrategy has briefly topped $100 billion. Since December 2024, the company's stock has

This article was written by

9.48K Followers
Experience as an investment analyst for a major BB-Bank, as well as private equity consultant for MBB. Currently working towards the CFA charter, having completed I&II. Passion for risk-assets (Growth, Contrarian, Emerging Market). Ex-colleague and close friend of Investor Express.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Not financial advice.

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