- Since the beginning of 2024, both MicroStrategy and Bitcoin have achieved very similar returns, both gaining 28% so far in 2024.
- MSTR has significantly outpaced Bitcoin. While Bitcoin has risen by 141% on the annual chart, at the same time, MSTR stock has gained 242%.
- Analysts expect that Microstrategy (MSTR) shares could soon enter the S&P 500 index. If so, this could lead to a significant liquidity flow for MSTR.
Following the rise in Bitcoin price on February 27th, the shares of MicroStrategy, which invests in Bitcoin, experienced a rapid surge.
MicroStrategy Shares Tracking Bitcoin
When the Bitcoin price reached $57,000, MicroStrategy made a similar move on Wall Street on Tuesday, February 27th. The share price of MicroStrategy (NASDAQ: MSTR) completed the trading session on Tuesday, rising by 9.46% to $871.
Since the beginning of 2024, both MicroStrategy and Bitcoin have achieved very similar returns, both gaining 28% so far in 2024. However, in the last year, MSTR has significantly outpaced Bitcoin. While Bitcoin has risen by 141% on the annual chart, at the same time, MSTR stock has gained 242%.
One of the significant reasons behind this rally in MSTR stock is the large Bitcoin holdings on the company’s balance sheet. The company’s CEO, Michael Saylor, stated that they will continue to acquire more Bitcoin in the future. Additionally, the company’s stock price is closely related to Bitcoin price movements. Furthermore, the total value of the company’s Bitcoin assets currently exceeds $10 billion, with $4.4 billion consisting of profits alone.
Last Monday, MicroStrategy purchased an additional 3,000 Bitcoins worth $155 million to its reserves. Since then, the BTC price has lost 10%. Along with the tremendous increase in MSTR shares, the company’s market value has already reached $15 billion. Analysts expect that MicroStrategy (MSTR) shares could soon enter the S&P 500 index. If so, this could lead to a significant liquidity flow for MSTR.
MSTR Share Price Could Reach $990
Investment banking firm Benchmark released a research report on Tuesday, confirming a buy recommendation for MSTR and approving a target stock price of $990, which implies more than a 15% gain from current levels.
Their projections are based on the expected value of the company’s Bitcoin assets by the end of 2025 and also the estimated value of business intelligence software operations. Benchmark’s price projection takes into account the possible approval of multiple spot Bitcoin ETFs and the upcoming halving, which could provide further support to the Bitcoin price. Benchmark Senior Equity Research Analyst Mark Palmer stated:
“Our price target for MicroStrategy is based on our assumption that the price of bitcoin will reach $125,000 by the end of 2025, a move that would be triggered by increased demand following the SEC’s approval of spot bitcoin ETFs in the U.S. in January and the impact of the fourth bitcoin halving, which is scheduled to occur in late April.”
Palmer emphasized that the decreasing rate of the halving could significantly push the price of the cryptocurrency upward over the next few years.
