Strategy (NASDAQ: MSTR), formerly MicroStrategy, reported a $12.54 billion quarterly unrealized Fair Market Value (FMV) loss, yet its stock rose on May 6 as Bitcoin (BTC) rebounded above $80,000.
The market response supports the idea that investors are prioritizing the firm’s characteristic focus on acquiring ‘digital gold’ over traditional earnings metrics.
However, while the company currently holds more than 818,000 BTC, worth around $67 billion, it’s still backed by roughly $2.25 billion in cash, meaning it continues to enjoy decent liquidity.
What’s more, the latest earnings call revealed shifts in Strategy’s approach to crypto, prompting analysts to revise their price targets upward despite the seemingly negative quarterly results.
Strategy is more flexible than ever, BTIG argues
Notably, BTIG raised its Strategy stock price target on May 5 from $250 to $350, reiterating a ‘Buy’ rating.
According to the analyst note, the management’s new willingness to consider selling Bitcoin when it is strategically beneficial marks an important shift from Strategy’s long-held ‘never sell’ approach.
BTIG’s take itself is noteworthy, as investors have historically treated any potential BTC sales on Executive Chariman Michael Saylor’s part as a red flag.
Overall, the updated price target and reiterated ‘Buy’ recommendation still reflect continued confidence in Strategy’s Bitcoin-centric model, which recently allowed it to surpass BlackRock as the largest institutional holder.
A day later, on May 6, Clear Street also reiterated a ‘Buy’ rating and raised its MSTR share price target from $233 to $240.
Is Strategy stock a buy?
Wall Street remains broadly bullish on Strategy. Based on 11 analyst ratings over the past three months, the stock carries a ‘Strong Buy’ consensus, with 10 ‘Buy’ recommendations, one ‘Hold,’ and no ‘Sell’ ratings, according to TipRanks data.
The average 12-month MSTR price target stands at $315.70, implying a potential 68.9% upside from the latest price.
Forecasts, however, show a wide dispersion. On the high end, analysts see MSTR reaching $540, while the lowest estimate sits at $200.
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