2024 was certainly an exciting year for Bitcoin (BTCUSD) and the broader crypto market, with Bitcoin smashing through the $100,000 milestone and securing its place in the financial mainstream. The SEC’s approval of Bitcoin ETFs earlier last year was quite a breakthrough, while President Donald Trump’s appointment of crypto advocate Paul Atkins as SEC chair signaled a new era for digital assets. With the Trump administration pushing a pro-crypto agenda, including plans for a Bitcoin reserve, self-custody rights, and lighter regulation, digital assets have taken center stage, fueling investors’ excitement.
In fact, 2025 might just be another blockbuster year for Bitcoin, with a new report from Fidelity suggesting that central banks and sovereign governments around the world could start adding Bitcoin to their reserves this year. This shift has the potential to unleash a wave of institutional investment, propelling Bitcoin’s value to new levels and solidifying its role in the global financial system. Having said that, one stock that massively benefited from the buzz around Bitcoin is MicroStrategy (MSTR).
Since launching its aggressive Bitcoin accumulation strategy in June 2020, the company has made cryptocurrency the core pillar of its valuation. And over the past year, it has doubled down, raising billions through convertible bond sales, exclusively to fuel its Bitcoin buying spree. This high-stakes approach has not only supercharged its market value but also drawn a dedicated base of retail investors, all while earning it a coveted spot in the Nasdaq-100 Index ($IUXX).
Though MicroStrategy has recently eased off its relentless Bitcoin purchases, its strategy continues to win favor on Wall Street. In a recent bullish note, Keefe, Bruyette & Woods praised the company’s unique positioning, emphasizing that it offers investors an amplified way to gain exposure to Bitcoin’s price movements. Thus, with Bitcoin’s prospects looking strong and analysts backing MicroStrategy’s bold vision, would it be wise to scoop up the shares of this company now?
About MicroStrategy Stock
Virginia-based MicroStrategy (MSTR) has established itself as the world’s first and largest Bitcoin Treasury company, setting the stage for a bold new approach to digital capital. By adopting Bitcoin as its primary treasury reserve asset, the company strategically leverages proceeds from equity and debt financings, along with cash flows from its operations, to accumulate Bitcoin. This innovative strategy offers investors a variety of ways to gain exposure to the digital asset, whether through equity or fixed-income securities.
Beyond its trailblazing Bitcoin approach, MicroStrategy is also at the forefront of artificial intelligence (AI)-powered enterprise analytics software. Presently valued at a market cap of around $76.6 billion, shares of this largest corporate Bitcoin holder have been on a blistering rally, delivering stunning gains of 352% over the past year, leaving the broader S&P 500 Index’s ($SPX) modest 20.7% return in the dust.
It’s no surprise that high-growth stocks like MicroStrategy often come with a hefty price tag. At a striking 173 times sales, the stock is valued well above both its industry peers and its own five-year average. This hefty premium reflects the market’s soaring expectations, with investors eager to bet on the company’s Bitcoin-driven growth narrative.
A Closer Look At MicroStrategy’s Q4 Performance
MicroStrategy’s fourth-quarter earnings release published on Feb. 5 presented a mixed bag of results. Total revenues reached $120.7 million in the final quarter of fiscal 2024, reflecting a 3% year-over-year decline that fell short of analysts’ expectations. Meanwhile, the company saw a notable shift in its financial performance, with its loss per share widening to $3.03, compared to a profit of $0.50 per share in the same period last year.
On the brighter side, MicroStrategy delivered a standout performance in its Subscription Services segment, which saw remarkable 48.4% year-over-year revenue growth, reaching $31.9 million. The company also achieved a significant milestone in its Bitcoin strategy, posting its largest-ever quarterly increase in Bitcoin holdings. Since the end of Q3, MicroStrategy acquired a stunning 218,887 Bitcoin for a total of around $20.5 billion.
This momentum carried over into fiscal 2025 Q1, with the company raising an additional $584 million through its inaugural STRK convertible preferred offering, drawing support from both institutional and retail investors. Presently, MicroStrategy holds 471,107 Bitcoin on its balance sheet, reinforcing its position as a leader in Bitcoin accumulation.
MicroStrategy Unveils a New Identity
Alongside its Q4 financial performance, the company unveiled a bold rebrand, adopting the name “Strategy.” This move reflects a natural evolution of the company’s focus, signaling a clear commitment to its Bitcoin-driven strategy. The new logo, featuring a stylized “B,” emphasizes the company’s role as a Bitcoin Treasury Company.
Founder and Chairman Michael Saylor remarked that “Strategy” is one of the most powerful words in the human language, encapsulating the company’s shift to its most strategic core.
Wall Street’s Bullish Bet on MicroStrategy Stock
On Feb. 7, Keefe, Bruyette & Woods initiated coverage on MicroStrategy with an “Outperform” rating, seeing the company as an ideal option for investors seeking leveraged exposure to Bitcoin. Analyst Bill Papanastasiou noted, “We view MSTR as an attractive proxy for investors seeking levered Bitcoin exposure with additional torque from accretive Bitcoin purchases that are fueled by highly demanded security issuances and a valuation that exceeds net asset value.”
Papanastasiou lauded the Michael Saylor-founded company for its strong track record in capital markets. He also pointed out that MicroStrategy has firmly established itself as a major issuer of Bitcoin-backed bonds. According to him, the company’s success in tapping capital markets is largely due to its first-mover advantage, its position as the largest Bitcoin holder, and its unmatched exposure to Bitcoin, all of which contribute to its unique stock profile.
Looking ahead, the analyst believes that MicroStrategy may even unlock a new revenue stream from on-chain yield via Bitcoin network applications, further enhancing its appeal to long-term investors. Overall, Wall Street appears to be all in on MSTR stock, with a consensus “Strong Buy” rating. Of the 11 analysts offering recommendations, 10 are giving it a solid “Strong Buy,” while the remaining one suggests a “Moderate Buy.”
The average analyst price target of $539.40 indicates an impressive 68.8% potential upside from the current price levels. The Street-high price target of $650 suggests that MSTR could rally as much as 103.5% from here.
