MSTR Stock Rises 4% As Wall Street Giant Sets Price Target At $540
Highlights
- Strategy's MSTR stock witnessed a boost in Thursday's pre-market trading.
- The stock price surged around 4% as H.C. Wainwirght doubled down on its 'Buy' rating for the stock.
- Earlier, Strategy selling MSTR shares caused a controversy around shareholder dilution.
The Strategy Inc. (NYSE:MSTR) stock has rallied in premarket trading today. After a Wall Street investment bank reaffirmed a “buy” rating on the Bitcoin treasury firm, the MSTR stock gained nearly 4%.
MSTR Stock Marks A Recovery
The MSTR stock soared 3.90% to $119.84 at press time in Thursday’s pre-market trading. The surge came as Wall Street firm H.C. Wainwright reiterated its “Buy” rating on the Strategy stock.
It also set a bullish price target of $540 for Strategy’s share price. This suggests a whopping 3.7x upside for the MSTR stock price, per current prices. Previously, the shares closed at $115.35, which fell 1.43% in the Wednesday, June 10 session.
Earlier, the pressure on the MSTR stock increased following the company’s 8-K filing on Monday, June 8. The disclosure revealed that Strategy sold over 1.4 million MSTR shares valued at around $181 million. Another negative market reaction came after that company executives sold over $15 million in stock for tax purposes last week.
The criticism continued to increase after analyst Kratter suggested the latest fund-raising activity was dilution. In reference to updated company figures, he pointed out that the company had 843,706 of its Bitcoin and 384,180 ADSO outstanding shares. Kratter said he thinks the “gain in shares is more worthwhile than a gain in Bitcoin per share in the short term.”
A direct response to the dilution debate came from Executive Chairman Michael Saylor. He denied that the move harmed MSTR shareholder value. “BTC Yield measures the increase in BTC per share, not total shareholder accretion,” Saylor wrote on X.
Saylor defended the overall deal as he highlighted the Bitcoin and the cash influx in the balance sheet. He added, “Last week Strategy added ₿1,550 of BTC and $100 million of USD Reserve. When both assets are included, the transaction was accretive to MSTR shareholders.”
Strategy Continues Buying BTC
Still, the sentiment of investors improved as Saylor announced that Strategy bought an additional 1,550 BTC on Monday. The purchase was worth roughly $101 million after last week’s market sell-off. The company acquired this stash at an average price of $65,332 per BTC.
The acquisition brought Strategy’s reserve to 845,256 BTC as it remains the world’s largest corporate Bitcoin holder. This week, the company also boosted its USD reserves by $100 million to $1 billion. It also led to the MSTR controversy as netizens say the stock sale spurred the surge in cash reserves.
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