bullish

Bitcoin

Yield

MicroStrategy’s ambitious goal of buying $42 billion worth of Bitcoin (<a data-ct-non-breakable="null" href="https://cointelegraph.com/bitcoin-price" rel="" target="_self" text="null" title="https://cointelegraph.com/bitcoin-price">BTC</a>) 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.
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 Source: <a data-ct-non-breakable="null" href="https://assets.contentstack.io/v3/assets/bltb564490bc5201f31/blt6977617232ec27a8/672296fd062510258f432d82/microstrategy-q3-2024-earnings-presentation.pdf" rel="nofollow noopener" target="_blank" text="null" title="https://assets.contentstack.io/v3/assets/bltb564490bc5201f31/blt6977617232ec27a8/672296fd062510258f432d82/microstrategy-q3-2024-earnings-presentation.pdf">MicroStrategy</a>
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Related: <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/microstrategy-further-gains-dont-fear-premium-analyst" rel="" target="_self" text="null" title="https://cointelegraph.com/news/microstrategy-further-gains-dont-fear-premium-analyst">MicroStrategy set for gains; ‘don’t fear the premium,' analyst says</a>
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.
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 Source: <a data-ct-non-breakable="null" href="https://assets.contentstack.io/v3/assets/bltb564490bc5201f31/blt6977617232ec27a8/672296fd062510258f432d82/microstrategy-q3-2024-earnings-presentation.pdf" rel="null" target="null" text="null" title="https://assets.contentstack.io/v3/assets/bltb564490bc5201f31/blt6977617232ec27a8/672296fd062510258f432d82/microstrategy-q3-2024-earnings-presentation.pdf">MicroStrategy</a>
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During its Aug. 1 earnings call, MicroStrategy doubled down on BTC buying by committing to a unique performance metric: <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/bitcoin-on-steroids-why-is-mstr-stock-trading-at-a-premium" rel="null" target="null" text="null" title="https://cointelegraph.com/news/bitcoin-on-steroids-why-is-mstr-stock-trading-at-a-premium">Bitcoin yield</a>.
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.&nbsp;
“Management 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 <a data-ct-non-breakable="null" href="https://cointelegraph.com/news/microstrategy-lend-bitcoin-boost-yield-analyst" rel="null" target="null" text="null" title="https://cointelegraph.com/news/microstrategy-lend-bitcoin-boost-yield-analyst">MicroStrategy should consider</a> a plan to start generating yield “by lending out a portion of its Bitcoin holdings.”&nbsp; Magazine: <a data-ct-non-breakable="null" href="https://cointelegraph.com/magazine/digital-yuan-adoption-payments-regulation/" rel="null" target="null" text="null" title="https://cointelegraph.com/magazine/digital-yuan-adoption-payments-regulation/">How the digital yuan could change the world… for better or worse</a>

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

Cointelegraph

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