Wall Street Analysts Back Strategy's $84 Billion Bitcoin Expansion Initiative

Key Insights:

Both Benchmark and TD Cowen maintained buy ratings, indicating confidence in the new capital-raising initiative.
Strategy is now aiming for a 25% Bitcoin yield and anticipates $15 billion in BTC profits by 2025, up from earlier projections.
The company has secured $28.3 billion already and plans to acquire an additional $56.7 billion over the next 32 months.

Wall Street’s support for Strategy’s (MSTR) plans for an expansive Bitcoin acquisition strategy is robust, as it indicates intent to double down on capital-raising goals.

Analyst Commentary

“As the number of firms attempting to replicate Strategy’s approach has increased, MSTR reaffirmed its competitive edge in Bitcoin acquisitions as its operational scale grows,” wrote Mark Palmer from Benchmark, reiterating a buy rating with a price target of $650.

Palmer views the current trading value of MSTR as attractive, especially under Executive Chairman Michael Saylor’s leadership, which has effectively generated shareholder returns through treasury management.

As part of its earnings report on Thursday evening, Strategy revealed an enhanced version of its 21/21 strategy — aiming to raise $84 billion through equity and debt instruments.

Lance Vitanza from TD Cowen acknowledged the ambitious strategy but deemed it plausible. He pointed out that with a $111 billion market cap and significant trading liquidity, raising an additional $56.7 billion in the coming months appears feasible.

Analysts also commended the company for raising its performance targets, elevating its BTC yield target to 25% and projected BTC gains up to $15 billion. Palmer noted that almost 90% of the original BTC yield aim has been reached within just a few months.

MSTR’s stock has seen a modest rise of 1.8% to $388, as Bitcoin hovers below the $97,000 mark.

In a recent earnings call, Saylor expressed that increasing adoption of Bitcoin by companies legitimizes it further, which could enhance its price. He remarked, “As more firms embrace Bitcoin, it bolsters its stability and value.”

Meanwhile, CEO Fong Li tackled dilution fears, asserting that issuing equity above net asset value is favorable rather than dilutive, and aims to optimize efficiency in the fixed income sphere.

Despite a reported $5.9 billion unrealized loss this past quarter due to Bitcoin fluctuations, CFO Andrew Kang remains optimistic, believing that transparency is crucial and expects positive shifts in alignment with the long-term strategy.