Key Takeaways
- MicroStrategy has raised $4 billion in convertible debt to buy bitcoin.
- The company holds 214,400 bitcoin worth about $14.5 billion.
- Bernstein rated MicroStrategy stock as outperform with a $2,890 price target.
MicroStrategy is pioneering bitcoin capital markets, according to a Bernstein report.
The Virginia-based company, led by Michael Saylor, has raised $4 billion in convertible debt to purchase bitcoin, making it the only firm with an institutional demand for bitcoin-linked convertibles.
Analysts Gautam Chhugani and Mahika Sapra highlighted that no other corporation has an active bitcoin investing strategy capable of attracting substantial capital.
214,400 BTC
MicroStrategy holds 214,400 bitcoin valued at approximately $14.5 billion.
The company started using bitcoin as a reserve asset in 2020 and has grown its bitcoin per equity share by nearly 67% over the past four years. The firm’s strategy involves issuing new debt when bitcoin prices rise and new shares when bitcoin prices fall, managing leverage efficiently.
Despite market fluctuations, MicroStrategy has not sold any bitcoin since its initial purchase and plans to continue raising capital to expand its holdings.
Bernstein has given MicroStrategy stock an outperform rating with a $2,890 price target. The company’s shares are trading relatively stable at around $1,509 after initially dropping by as much as 2.5%.
