Strategy shares (MSTR) rose 1.5% in early trading Tuesday, hovering around $301, as Citi’s (C) note positioned the company as a direct proxy for Bitcoin’s long-term growth. The firm’s analysts estimated that under their base case, Bitcoin could climb to $181,000, fueling a 25%–35% net asset value (NAV) premium on Strategy stock.
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The report emphasized that Strategy’s performance is magnified by its Bitcoin exposure, typically moving 2.5 to 3.5 times faster than the underlying asset. This means while the company could enjoy outsized gains during bull markets, it remains vulnerable to steep losses if Bitcoin retreats.
Citi’s bear case projects a 61% drop in MSTR if Bitcoin declines 25% and the NAV premium swings to a 10% discount.
Saylor’s Bitcoin Playbook Drives Strategy’s Treasury Model
Led by Executive Chairman Michael Saylor, Strategy became one of Wall Street’s most visible corporate holders of Bitcoin after pivoting its balance sheet toward the cryptocurrency in 2020.
The company has financed much of this accumulation through a mix of convertible debt, preferred equity, and stock issuance, depending on market conditions and NAV premiums. Citi said this model remains “core to the company’s expansion strategy,” enabling it to increase its holdings even in volatile markets.
According to a Monday filing, Strategy purchased an additional 168 BTC at an average price of $112,051, bringing total holdings to 640,418 BTC, worth more than $72 billion at current prices.
Citi’s analysts credited Strategy’s “Bitcoin yield,” the year-to-date increase in BTC per fully diluted share, as a key driver of investor sentiment and NAV performance.
Is Strategy a Good Stock to Buy?
Currently, Wall Street maintains a Strong Buy consensus on Strategy stock, based on 14 analyst ratings in the past three months. The breakdown includes 13 Buys and one Sell recommendation.
The average 12-month MSTR price target stands at $544.27, implying a 79.08% upside from current levels.
