Strategy (NASDAQ:MSTR) keeps adding to its Bitcoin haul, no matter which way the wind is blowing. Over the past week, the firm bought 168 bitcoins for $18.8 million, funded entirely through preferred shares.
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After factoring in future common share issuance to cover cash dividends, Cowen analyst Lance Vitanza estimates a net gain of 115 bitcoins, or about $12.9 million in value. Nevertheless, he believes the move is a positive one for MSTR.
“While it may seem counter-intuitive to traditional financial analysts, the transactions while incremental are definitively accretive to shareholder value,” the 5-star analyst went on to say.
The Michael Saylor-led company’s latest purchase follows a recent crypto crash that raised questions about Bitcoin’s near-term trajectory. The flash crash two Fridays ago – triggered by renewed trade war fears after President Trump announced 100% tariffs on Chinese goods – wiped out $19 billion in leveraged crypto positions, nearly twenty times the liquidations seen during the FTX collapse in the 2021–22 “crypto winter.”
While Vitanza recognizes the recent turmoil caused “intense financial hardship” for many investors, what stands out to him is how well the crypto ecosystem held up. Despite marking the largest single-day liquidation on record and cutting open interest in half across platforms, most exchanges experienced little to no downtime. Liquidity dropped about 65% but recovered within 35 minutes. Lesser-known tokens were hit hard, but Bitcoin and Ethereum remained relatively resilient. Bitcoin, for instance, fell as much as 15% intraday before closing only 8% lower. With the leading digital asset trading 11% below its recent all-time high, Vitanza argues that for those taking the long-term view, this is “anything but a disaster.”
Meanwhile, global Bitcoin adoption continues to gather momentum. In Japan, the number of registered digital asset accounts has quadrupled over the past five years, reaching more than 7.9 million as of August. This surge has resulted in the country’s Financial Services Agency (FSA) revisiting Japan’s long-standing ban on banks investing in digital assets such as Bitcoin. At the same time, the Securities and Exchange Surveillance Commission is drafting new rules to curb and penalize insider trading in crypto to help remove bad actors from the market. While the final outcome is still uncertain, Vitanza expects Japan to eventually ease its restrictions, paving the way for traditional financial institutions to hold Bitcoin on their own balance sheets.
Japan’s move follows the UK’s recent legalization of retail access to Bitcoin ETPs, including certain retirement accounts. Effective October 8, the change allowed BlackRock to launch its first UK retail Bitcoin ETP on Monday. “We remain encouraged by the accelerating adoption of Bitcoin and believe this long-term trend outweighs short-term volatility in Bitcoin or Strategy’s premium,” the analyst summed up.
To that end, Vitanza maintained a Buy rating on MSTR shares, backed by a $620 price target. Should the figure be met, investors will be pocketing returns of a hefty 105% a year from now. (To watch Vitanza’s track record, click here)
Almost all other analysts are thinking along the same lines. The stock claims a Strong Buy consensus rating, based on a mix of 14 Buys vs. 1 Sell. There are robust gains projected here; at $540.32, the average target factors in 12-month returns of 79%. (See MSTR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.