Strategy (MSTR), formerly MicroStrategy, stock ended down on June 5 as the world’s largest cryptocurrency by market cap, Bitcoin (BTCUSD), slipped briefly below the closely watched $60,000 level.
The selloff compounds an already difficult stretch for MSTR — the company's four-year “never sell” commitment cracked last week, when it disclosed the sale of 32 bitcoins.
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Versus its year-to-date high, Strategy stock is down more than 35% at the time of writing.
www.barchart.comShould You Sell Strategy Stock Then?
Despite recent weakness, the underlying thesis for MSTR stock remains intact for those willing to look past near-term volatility.
Strategy owns the single largest corporate Bitcoin position on earth, and at current prices, the stock is trading at a historically compressed premium to its net asset value.
According to Wall Street analysts, the significantly contracted NAV premium creates a much more favorable entry point for investors who remain convinced that Bitcoin will reclaim and surpass its prior highs.
Note that MSTR’s relative strength index (RSI) sits in the late 20s currently, indicating oversold conditions that often trigger a relief rally.
What Else Makes MSTR Shares Worth Owning?
One of the most constructive developments that has been overshadowed by the Bitcoin selloff is Strategy’s decisive move to reduce its debt load.
In late May, the company completed a $1.5 billion repurchase of its 0% convertible senior notes due 2029, paying roughly $1.38 billion in cash.
This represents an 8% discount to par value that effectively saved MSTR around $120 million on the transaction.
Crucially, the company didn’t sell a single BTC to fund it; instead, it tapped existing cash reserves, ATM equity proceeds, and STRC preferred stock issuance.
What's also worth mentioning is that MicroStrategy shares have a history of gaining more than 7% on average in July, a seasonal pattern that makes this crypto stock even more attractive to own in the near term.
How Wall Street Recommends Playing Strategy
Investors could also take heart in the fact that Wall Street analysts haven’t thrown in the towel on MSTR shares.
The consensus rating on Strategy remains at “Strong Buy,” with the mean price objective of about $363, indicating potential for a 200% rally from here.
www.barchart.com On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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