Markus Thielen from 10x Research suggests that MicroStrategy's stock is nearing its true value. In March, his firm estimated the stock's fair price at about $1,000, indicating that investors might prefer direct Bitcoin investments instead.
As of Friday, MicroStrategy's market cap stood at $21.37 billion, with 214,400 BTC on its books, valued at $13.26 billion.
MicroStrategy is often viewed as a proxy for a Bitcoin ETF, lacking typical ETF mechanisms like market makers or redemption processes. Consequently, its stock price can fluctuate widely based on market sentiment.
The company employs unique tactics such as issuing low-cost debt to purchase more Bitcoin or selling stock at a premium.
Earlier this year, such strategies drew criticism due to the stock's high premium, which some deemed unjustified. Nonetheless, supporters argue that the premium reflects the company's potential to acquire more Bitcoin per share in the future.
James Butterfill of CoinShares describes MSTR as a leveraged bet on Bitcoin, typically moving 1.5 times with Bitcoin's price. He emphasizes that monetary policy has a greater impact on the stock than traditional business fundamentals.
Butterfill suggests that the recent Bitcoin price drop, triggered by the FOMC's tentative monetary policy shift, was an overreaction. He anticipates stabilization in both MSTR and Bitcoin prices soon. 📈🔍💰
