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▲ Strategy (MSTR), Bitcoin (BTC)/AI generated image
Investors in Strategy (MSTR) are looking towards July 4th. An analysis suggests that if the US cryptocurrency market structure bill becomes a reality, MSTR, which acts as a proxy investment in Bitcoin (BTC), could again be exposed to strong volatility.
According to financial media outlet Barchart on June 20th (local time), the White House is targeting July 4th as the deadline for the US cryptocurrency market structure bill. Barchart reported that if this schedule materializes, Strategy could gain additional upward momentum. Strategy is still also known as MicroStrategy and is the largest corporate holder of Bitcoin.
MSTR stock rose 5.8% on Monday with the Bitcoin rebound. However, it is still down 68% over the past 52 weeks. The stock price is below both the 50-day moving average of $155.02 and the 200-day moving average of $195.15.
Valuations of the company also differ. Strategy's market capitalization is approximately $42.35 billion. Revenue for the past 12 months was $490.47 million. While the price-to-sales ratio is high at about 86x, the price-to-book ratio based on a book value of $45.64 billion is approximately 0.9x.
Q1 earnings showed a significant divergence between surface figures and profit/loss. Revenue increased by 11.9% year-over-year to $124.3 million. Gross profit was $83.4 million. However, due to the bearish Bitcoin price being reflected in accounting, an operating loss of $14.47 billion and a net loss of $12.54 billion were recorded.
Strategy completed a $1.5 billion debt repurchase on May 26th. Its Bitcoin holdings increased to 843,738 BTC. Dollar reserves stand at $871 million. On June 8th, shareholders approved a proposal to change STRC dividend payments from once a month to twice a month.
Wall Street's assessment remains favorable. Clear Street raised its price target to $240 and maintained a Buy rating. Canaccord lowered its price target to $163 but maintained a Buy rating. Mizuho presented a price target of $265 and an Outperform rating, while BTIG maintained a price target of $350 and a Buy rating. Barchart reported that the average price target of $363.62 implies a 199% upside from the recent price.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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