MSTR Stock Price Crashes as Strategy Overhauls Bitcoin Valuation Metrics Ahead of Earnings

Strategy (NASDAQ: MSTR) stock price closed trading at $91 on July 24, having dropped by 2.09%. The drop came a day after Strategy revealed that it is changing how it measures the mNAV to assess the exposure that an MSTR stock holder has to Bitcoin.

The dropping share prices and recent changes come as the STRC preferred stock remains below its par value of $100 ahead of the company’s Q2 financial results coming out on July 30.

Strategy Unveils New Bitcoin Valuation Framework

In a recent explanatory video posted on X, Strategy said that it will be using the net Bitcoin per share to calculate the mNAV, and not the company’s gross holdings that it used before.

The Bitcoin treasury company will calculate this Net BTC per share after deducting the company’s net debt and preferred liabilities from the value of the Bitcoin that it holds.

Data from Strategy now shows that the company holds 554,569 in net Bitcoin, while its gross holdings stand at 843,775 BTC.

These changes come shortly after Strategy CEO Phong Le said that the company will not buy more Bitcoin until the STRC preferred stock reaches $100. He said the company was doing this at the behest of shareholders.

Strategy has also been selling MSTR stock and Bitcoin holdings to increase its USD reserve to help bring back the STRC price to the par price of $100.

Still, Strategy recently moved to establish a Bitcoin Security Consortium alongside Coinbase, BlackRock and ARK Invest to improve BTC security, suggesting that the company remains committed to its treasury plans.

MSTR Stock Price Crashes Below Key Support

MSTR stock price closed below the support of $94 on July 24. The drop occurred due to selling pressure around US stocks caused by escalating geopolitical tensions.

If Strategy share price closes below this support of $94 for three straight days, it might drop to the June 26 low of $81.

The CMF reading of -0.02 suggests that this drop to $81 might occur because the selling pressure remains more than the buying pressure.

However, this CMF line is rising, suggesting that sellers are gradually losing momentum. This might create room for buyers to step in and defend the support of $94.

If MSTR stock closes above $94, the shares might move to the 20-day EMA of $99. But such gains would depend on a rise in buying pressure.

Cantor Fitzgerald Reiterates $212 Target for MSTR Stock

Cantor Fitzgerald, an asset management firm with $13 billion in assets under management, has reiterated a $212 target for the MSTR stock.

The asset manager says that the recent changes that Strategy is making to increase its cash reserves could drive gains for STRC and MSTR stocks.

It also adds that there is no risk to Strategy selling Bitcoin because the market could easily absorb the sold coins.

Still, Cantor says that Strategy’s market share as a crypto treasury company could be eroded by other firms because of STRC’s de-peg from its par of $100. A decline in Bitcoin price could also pull MSTR stock down, per the asset manager.