The post Is MicroStrategy Set for S&P 500 Inclusion? What You Need to Know appeared first on Coinpedia Fintech News
Rumors are swirling in the financial world that MicroStrategy ($MSTR) may soon join the illustrious ranks of the S&P 500 index. Broker Benchmark suggests that with a few strategic moves, MicroStrategy could meet the criteria for inclusion in this prestigious index, potentially reshaping the companyâs future trajectory.
Impending Earnings Report
MicroStrategy, led by CEO Michael Saylor, is set to release its earnings report in just four days. Analysts anticipate a quarterly loss of $0.55 per share. However, adopting new accounting standards could potentially turn that expected loss into a gain of over $300 per share.
MicroStrategy currently ticks almost all the boxes for S&P 500 inclusion, boasting adequate liquidity and market capitalization. However, the missing piece of the puzzle has been consistent positive earnings in quarterly reports, a feat that early adoption of the Financial Accounting Standards Boardâs (FASB) new rules could accomplish.
Early Adoption of Accounting Standards
While the FASBâs new accounting rules arenât slated to take full effect until 2025, companies can adopt them early. MicroStrategyâs decision to embrace these standards ahead of schedule could be a game-changer, potentially paving the way for its inclusion in the S&P 500 index.
MicroStrategy has faced challenges in its earnings reports, with losses recorded in 10 out of the last 14 quarters. However, the companyâs proactive approach to adopting new accounting standards suggests a potential shift in this trend. This strategic move could significantly impact MicroStraegyâs valuation and market perception.
Analysts foresee substantial benefits for MicroStrategy if it secures a spot in the S&P 500.
One analyst notes, âInclusion in the S&P 500 would position MSTRâs stock valuation to receive an ongoing boost from the price-agnostic purchases of its shares resulting from enormous passive inflows.â
This suggests that joining the S&P 500 could unlock a new wave of investment and growth opportunities for MicroStrategy.