• Monness Crespi Hardt reiterates Neutral on Strategy (MSTR) with a ~$130 fair value estimate.
  • The firm cites a $14.5B bitcoin-related loss and a shift to opportunistic BTC sales, weakening the original bullish thesis.
  • Analysts see limited near-term upside, keeping them on the sidelines as the company pivots capital strategy.

A Pivot in Strategy

Monness Crespi Hardt is staying put on Strategy (MSTR), maintaining a Neutral rating and a fair value estimate of roughly $130 per share. The decision comes after the firm flagged a massive $14.5 billion bitcoin-related loss, a shift in the company’s capital-raising approach, and a move to sell Bitcoin opportunistically — changes that analysts say undermine the original investment thesis.

“These actions represent a material departure from the prior strategy of accumulating and holding Bitcoin,” the analysts wrote in a note. The firm’s shift toward selling BTC at times, rather than consistently buying, introduces new uncertainty around the company’s core value proposition.

Capital Structure in Flux

Strategy, formerly MicroStrategy, has long been known as the world’s largest corporate Bitcoin holder. But its financing methods are evolving. The company has increasingly turned to perpetual preferred equity to fund purchases, moving away from traditional equity and debt offerings. While this may reduce dilution, it also adds complexity and risk to the balance sheet.

“The capital strategy pivot weakens the original thesis that MSTR offered a pure play on Bitcoin appreciation with a largely static stack,” the note said. Monness Crespi Hardt pointed out that the large unrealized losses, tied to Bitcoin’s volatile price, have eroded equity value. Without a sustained rally in BTC, the stock may struggle to gain traction.

Limited Upside Ahead

The analysts see limited catalysts in the near term. Bitcoin’s price remains a key driver, but the company’s new willingness to sell into strength could cap upside. “We see a scenario where MSTR trades in a range, constrained by the need to manage its crypto exposure and capital costs,” they wrote.

Efforts to reach Strategy for comment were unsuccessful. The company’s stock has been volatile, reflecting both Bitcoin price swings and investor uncertainty over the changing strategy.

The Broader Picture

The news comes as other corporate Bitcoin holders face similar scrutiny. The sector continues to debate the merits of crypto treasuries, especially as regulatory guidance evolves. For now, Monness Crespi Hardt remains cautious, advising investors to wait for greater clarity on Strategy’s capital plan and Bitcoin’s trajectory.

Correction: An earlier version of this article misstated the amount of the bitcoin-related loss. It is $14.5 billion, not $14.5 million.