MicroStrategy (NASDAQ:MSTR) Lands $2,890 Price Target from Bernstein
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MicroStrategy (NASDAQ:MSTR) Lands $2,890 Price Target from Bernstein

Story Highlights

Bernstein has started coverage of MicroStrategy stock with a Buy rating and a $2,890 price target.

Bernstein has started coverage of MicroStrategy stock with a Buy rating and a $2,890 price target. Analyst Gautam Chhugani expects Bitcoin’s price to soar to $200,000 by 2025, up from his previous target of $150,000, due to high demand and limited supply. Given that MicroStrategy is the largest corporate holder of Bitcoin, it stands to benefit if his prediction comes true.

He also pointed out that MicroStrategy’s aggressive strategy of leveraging Bitcoin has resulted in a higher amount of Bitcoin per equity share, which supports a premium valuation for the company’s stock.

MicroStrategy to Raise $700M

After MicroStrategy (NASDAQ:MSTR) announced yesterday that it was planning to raise $500 million in convertible debt, the tech company revealed today that the number has increased to $700 million following strong investor demand. Buyers also have the option to purchase an additional $100 million in notes within 13 days.

These notes will come with a 2.25% annual interest rate and can be converted into cash, shares of MicroStrategy’s class A common stock, or a mix of both at an initial conversion price of around $2,043.32 per share. They will mature on June 15, 2032.

MicroStrategy aims to use the approximately $687.8 million from this deal, or $786 million if the additional notes are sold, to buy more Bitcoin (BTC-USD) and for general corporate purposes.

Is MSTR Stock a Good Buy?

Overall, Wall Street analysts have a Strong Buy consensus rating on MSTR stock based on four Buys assigned in the past three months, as indicated by the graphic below. After a 436% rally in its share price over the past year, the average MSTR price target of $1,793 per share implies 21% upside potential.

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