From Nasdaq

June 01, 2025 11:26 PM:

Strategy Inc. (NASDAQ: MSTR) has become a significant proxy for Bitcoin, with a 24% YTD stock increase mirroring Bitcoin’s rise. MSTR stock has soared nearly 500% since early 2024, driven by factors like a 712% increase in the price-to-sales ratio and a 29% increase in outstanding shares.

Strategy’s sales have declined from $496 million to $459 million, reflecting a shift from software to Bitcoin focus. Net income margins swung from 86.5% to -1161% due to Bitcoin accounting rules. The eight-fold rise in valuation multiple indicates investor preference for Bitcoin holdings over software sales.

With a P/S ratio of 171x, MSTR’s valuation is primarily driven by its Bitcoin holdings, making it an attractive investment if Bitcoin performs well. Factors like finite supply, weakening USD, political support, and institutional interest suggest long-term growth potential. However, historical volatility poses significant risks for investors.

Despite risks, MSTR may appeal to long-term investors, but those wary of volatility can consider alternative strategies like the Trefis High Quality Portfolio, which has outperformed the S&P 500 over the past four years with less risk and volatility.

Read more at Nasdaq: What’s Behind The 500% Rise In MSTR Stock?