Software stock MicroStrategy has a $13 billion Bitcoin stash, Barclays rates as attractive investment opportunity.

From Nasdaq

September 11, 2024 7:13:45 pm:

1. Bitcoin has doubled in price over the last year, now valued at $1.13 trillion as the largest cryptocurrency globally and 10th largest asset by market cap. Price surge expected in next 14 months after halving event in April 2024.

2. MicroStrategy, valued at $23 billion, offers enterprise analytics software and services, with a 890% return to shareholders since 2014 due to Bitcoin exposure.

3. MicroStrategy invested $250 million in Bitcoin in 2020, now holding 225,500 Bitcoins worth almost $13 billion, purchased at an average price of $36,821. Potential investment profits of $5 billion.

4. Barclays initiated coverage on MicroStrategy with an “Overweight” rating as an attractive BTC investment opportunity with potential for further accumulation. Analysts have a consensus “Strong Buy” rating.

5. Average stock price target for MicroStrategy is $198.45, indicating over 53% upside potential. However, investing in MSTR is high-risk due to Bitcoin’s volatility.

6. MicroStrategy has raised debt capital to increase its BTC position, resulting in a net debt of almost $4 billion by June 2024. Operating cash flow is at $5.2 million in the last six months, with a free cash outflow of $3 million. Company may struggle to service debt without creative capital-raising methods.

Read more at Nasdaq: With a $13 Billion Bitcoin Stash, is This Software Stock Worth Adding to Your Portfolio?