From Financial Modeling Prep: 2025-04-02 14:17:00

Clear Street has initiated coverage on MicroStrategy (NASDAQ:MSTR) with a Buy rating and a $422 price target, praising the company’s unique approach to leveraged Bitcoin exposure. Unlike passive instruments, MicroStrategy actively boosts its Bitcoin holdings through strategic use of convertible debt and equity offerings, outperforming Bitcoin by 54% over the last year.

The report highlights MicroStrategy’s treasury operations, projecting a 15% annual increase in Bitcoin per share over the next two years. This growth is seen as economically similar to EPS growth, justifying a forward multiple of around 9x for incremental BTC-per-share gains. However, the company’s leverage could amplify losses if Bitcoin adoption weakens or its price declines.

Clear Street warns that MicroStrategy’s aggressive strategy could be a double-edged sword, with potential risks if Bitcoin adoption weakens or capital market access is restricted. Despite its innovative approach to Bitcoin exposure, the company must navigate these challenges to sustain its growth and generate future yield.



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