MicroStrategy (NASDAQ:MSTR) isn’t much by itself. A cloud computing stock that few have actually heard of, it wouldn’t be nearly the force it is today without one big, and somewhat unlikely, bet. MicroStrategy bought heavily into Bitcoin (BTC-USD), and the result has produced some amazing returns. Those returns weren’t enough to help keep MicroStrategy shares aloft today, though, as it lost over 2% in Tuesday afternoon’s trading session.
While MicroStrategy’s cloud-based offerings aren’t exactly a household word, it put a ton of cash behind Bitcoin, which delivered impressive results. In fact, for a while, MicroStrategy’s share price would move up or down in sympathy with major Bitcoin moves. The gains have been substantial, as some even came to regard MicroStrategy as a way to invest in Bitcoin without shelling out huge prices for an actual coin. MicroStrategy stock gained around 337% in 2023, which beat nearly every other company in the United States valued at at least $5 billion.
But What About the Bitcoin ETF?
One of the newer developments in the financial landscape, overall, is the Bitcoin exchange-traded fund (ETF). It’s been in the works for quite some time, and with the Securities and Exchange Commission (SEC) finally muzzled by the courts on said issue, we’re looking at a great potential release to come. But if MicroStrategy loses one of its key investment points—being a cheaper way to invest in Bitcoin—will it suffer in turn? MicroStrategy, for its part, doesn’t find that likely. After all, founder Michael Saylor noted, ETFs charge fees and are unlevered. But since MicroStrategy is a going concern with offerings outside of Bitcoin, it comes with a little extra diversification.
Is MicroStrategy a Buy Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MSTR stock based on three Buys assigned in the past three months, as indicated by the graphic below. After a 309.91% rally in its share price over the past year, the average MSTR price target of $663.33 per share implies 9.73% upside potential.
