MicroStrategy’s (MSTR) Bitcoin (BTC) play is drawing attention as Canaccord recently called its ‘intelligent leverage strategy’ ideal for investors to gain exposure to BTC.
MicroStrategy Stocks Ideal for Gaining Bitcoin Exposure
In the study report published yesterday, financial services firm Canaccord reiterated that buying MicroStrategy shares remains one of the best ways for investors to gain exposure to BTC.
The company has agreed to MicroStrategy’s overall Bitcoin acquisition strategy, including its own the latest The ’21/21 Plan’, which involves a $42 billion cash flow split equally between At The Market (ATM) equity offerings and fixed income securities.
The above amount will fund future BTC purchases and continue to strengthen MicroStrategy’s reserves. It will also increase MicroStrategy’s BTC yield to a target rate of 8% over the next three years.
Notably, Canaccord raised its price target on MSTR from $173 to $300, an increase of about 73%, while maintaining a ‘buy’ rating on the stock. MSTR is trading at $238.55 at press time, down 2.43% during trading hours.
Canaccord noted that since MicroStrategy adopted a strategy to accumulate the Bitcoin trademark in 2020, it has outperformed the stock market and BTC. The report reads:
If stock price is the true test of any business model, then in our view MSTR is hard to beat. MicroStrategy’s leverage strategy provides an opportunity for an additional premium to be reflected in MSTR shares.
In addition, the financial services company showed optimism for the value of BTC, saying that the main digital asset benefited from the US Securities and Exchange Commission’s (SEC) approval of Bitcoin-based exchange-traded funds (ETF).
The company also emphasized the impact of the supply shortage created by Bitcoin by halving the price of the digital asset. Notably, BTC achieved its halving on April 20, 2024. At that time, it was trading slightly above $64,000.
While the halving has since acted as a bullish catalyst, leading to an unusual price increase, its effects usually appear around 6-12 months. That said, some crypto analysts and research firms have shown doubts about the impact of this year’s halving.
More Firms Are Following in MicroStrategy’s Footsteps
A growing number of firms around the world are imitating MicroStrategy’s Bitcoin intelligence. For example, recentlyJapanese company Metaplanet is holding a stock sale to raise $68 million Purchase of BTC.
In September 2024, Nasdaq listed Semler Scientific it was revealed the purchase of 83 BTC worth about $5 million. The purchase increased the company’s total BTC reserves to 1,012 BTC.
Similarly, Samara Asset Group, a German investment company, recently shared plans to raise nearly $33 million to grow its BTC holdings. BTC is trading at $69,678 at press time, down 1.4% in the last 24 hours.
Featured image from Unsplash.com, Charts from Yahoo! Finance and TradingView.com
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