Strategy (MSTR), the company formerly known as microstrategy, is an appealing investment for equity investors looking for levered bitcoin (BTC) exposure, the KBW investment bank said in a research report Thursday.
KBW assumes the scope of the approach with an outperform rating and a target price of $ 560. The shares are 1% higher around $ 329 in early trading.
When the strategy, the company established by Michael Saylor, adopted the Financial Accounting Standards Board (FASB) updated accounting treatment for Bitcoin handles in the first quarter of this year, it will move from an “obsolete Measuring approach to the fair amount of accounting, along with the unknowingly acquired/losses flowing to net income, “analyst Bill Papanastasiou wrote.
The company reported the loss of $ 1 billion for the fourth quarter of 2024 as it did not adopt new FASB policies.
One of the most important criteria for joining the S&P 500 index is the net positive income in the last quarter and the rest of the past four quarters, the report said.
The approach has the “largest Bitcoin Treasury held by a public operating company,”, and the company has a number of tools it can use to expand the BTC stack, KBW said.
For a longer period, there is also an opportunity for the approach to produce an on-chain yield from applications built on the Bitcoin network, the bank said.
Developing applications at the top of the Bitcoin network can result in a massive unlock value, as it is the most safe, decentralized and important public blockchain, the report added.
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