Bitcoin Halving, MicroStrategy Stock Target Raised as Benchmark for BTC ETF

Brokerage Benchmark said MicroStrategy stock could rise significantly as the company is positioned to benefit from Bitcoin’s April 20 halving and strong demand from the BTC ETF.

Benchmark raised its target stock price. MicroStrategy (MSTR) from $990 to $1,875 and maintain a Buy rating on the company. The raised target is based on the assumption that BTC will reach $150,000 by the end of 2025, which is an increase from the previous estimate of $125,000.

MSTR price reacted positively to the report, upsurge Over the past 24 hours, it’s traded up more than 5%, at $1,512.99 as of 2:50 a.m. ET.

“The upcoming Bitcoin halving will cause a supply shock as before, but the impact of this event could be magnified by the simultaneous demand shock arising from the emergence of spot Bitcoin exchange-traded funds (ETFs),” said analyst Mark Palmer. “I believe it,” he said. . “We expect inflows into spot Bitcoin ETFs to increase dramatically once institutions start investing in earnest.”

The benchmark said MicroStrategy expects to increase its BTC holdings in the coming weeks using proceeds from capital markets transactions.

The additional cash generated by the software business will also be used to purchase more BTC, the report said. The benchmark predicts that the company will hold 298,246 BTC by the end of 2025, up from the 214,246 coins it held as of March 19.

MicroStrategy stock price “unjustifiable”

Not everyone is optimistic about MicroStrategy’s stock price. Investment firm Kerrisdale Capital said in a March 28 survey: memo It said MSTR’s price was “exceptionally high” and its valuation was “unjustifiable.”

Kerrisdale Capital’s short position #microstrategy ($MSTR) You will feel the pressure soon!!! Don’t jump in front of a freight train 🚆 pic.twitter.com/s7c9Mf0Kv6

— InvestAnswers (@invest_answers) April 4, 2024

Investors inflated prices. of the company BTC holdings resulted in a premium, the company said. Most of this BTC was purchased through debt financing, equity-linked convertible bonds, and ATM stock offerings. Kerrisdale Capital’s Claim Calling a company’s use of leverage to buy BTC “intelligent” is faulty logic.

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