MicroStrategy no longer needs to be presented. The company masterfully managed by Michael Saylor is one of the largest holders of bitcoins in the world. In recent months, the company has particularly attracted attention through its massive acquisitions of bitcoins. A trend whose effects in the exceptional resurgence of the flagship crypto have also been reported by analysts. Due to its status as a bitcoin whale, MicroStrategy positions itself as one of the key players in the crypto industry eagerly awaiting the bitcoin halving. According to experts, the company should reap the laurels from this event. Here are the ones in this article.
Projection of an increase in the valuation of MicroStrategy…
Many analyzes have so far been devoted to the impacts that the imminent halving of bitcoin would have on the crypto market. On this point, many experts are betting on a surge in the price of bitcoin. This projection particularly concerns the action of the company MicroStrategy known to be one of the most important bitcoin whales.
Interesting to the influences that halving would particularly have on the company, some experts are convinced that the company's stock should explode with the advent of this key crypto event. This is particularly the case for Mark Palmer, senior equity research analyst for The Benchmark Company.
Recently, this expert revised upwards his forecasts regarding the movement of the price of MicroStrategy stock. He thinks that with halving, the latter should reach a unit price of $1,875. This upward revision represents more than double its previous estimate of $990 per share established last February. A fundamentally optimistic readjustment which seems greatly influenced by the recent skyrocketing price of bitcoin which reached more than $69,000 in valuation.
This revision comes in a context where the MicroStrategy share price is currently around $1,538. This, showing growth of 125% since the start of the year and an increase of 8% compared to the previous month. It is based on the assumption that the price of bitcoin could reach $150,000 by the end of 2025. But the opinion expressed by Mark Palmer goes a little further.
In a context of dynamism in spot Bitcoin ETFs…
In less than two weeks, bitcoin will undergo a halving. On this occasion, miner rewards for each block will increase from 6.25 BTC to 3,125 BTC, according to forecasts. This reduction, traditionally associated with a “supply shock”could this time have an amplified impact, fueled by the growing demand for spot Bitcoin ETFs.
Mark Palmer highlights this trend by noting that the 11 US spot Bitcoin ETFs held approximately 827,000 BTC as of April 3. This, with net inflows of more than $12 billion since their launch in January. In this context, the expert predicts a significant increase in inflows into these ETFs. Particularly when institutions start investing massively. This anticipation, reinforced by the history of bitcoin movements, which tends to increase after the halving, is shared by Bitfinex analysts. For their part, they project a 160% increase in bitcoin over the next 14 months, to reach more than $150,000.
However, Bitfinex analysts point out a certain anomaly. Note that bitcoin often reaches a historic high before the halving. Constant that introduces uncertainty into market dynamics. That said, Dan Weiskopf, co-portfolio manager of the Amplify Transformational Data Sharing ETF (BLOK), has a strong opinion regarding MicroStrategy's prospects given this data. He believes that if the price of bitcoin increases after the halving, MicroStrategy will likely follow this trend, as the company is highly correlated to bitcoin action.
Regardless, observers expect the impact of halving to be even more significant this time around. This is particularly due to the strong demand for financial products linked to bitcoin. Overall, the outlook for MicroStrategy stock looks promising, and the company may act accordingly.
MicroStrategy could increase its exposure to bitcoin
Over the past 15 weeks, MicroStrategy has steadily increased its bitcoin investments, capturing the attention of the financial markets crypto industry. As of March 19, MicroStrategy already held an impressive stash of 214,246 bitcoins. The latter was recently enriched by 9,000 bitcoins, following an offering of $500 million in senior convertible bonds maturing in 2031.
Based on this data, The Benchmark Company analyst is once again bullish on MicroStrategy. He predicts that by the end of 2025, MicroStrategy could hold a staggering portfolio of 298,246 bitcoins. This would represent a nearly 40% increase in his bitcoins compared to his current holdings.
This forecast matches that of Lance Vitanza, managing director of equity research at TD Cowen. Last year, the expert highlighted the likelihood that MicroStrategy would continue to acquire bitcoins based on market conditions. In a March 20 research note, Lance Vitanza also discussed a premium placed on MicroStrategy's bitcoin holdings.
He estimates that the market values these holdings at a 90% premium to the value of the company's core business. The latter being valued at $1.25 billion. According to him, any future decrease in this premium could be offset by an increase in the underlying price of bitcoin. Particularly due to growing demand fueled by new exchange traded products (ETPs) supported by halving.
This is a strategic advantage offered to MicroStrategy, according to Dan Weiskopf. Because the company can continue to buy bitcoins profitably. This, thanks to the issuance of convertible bonds at very attractive interest rates, such as those of 0.625% and 0.875%, executed last March.
Finally, Palmer highlights other factors that support MicroStrategy's stock's trading premium. These include its ability to skillfully use financial markets to finance its bitcoin acquisitions. This strategy, combined with judicious asset management and a clear view of the future value of crypto, strengthens MicroStrategy's crypto position. It especially attracts the attention of investors looking for solid returns in a constantly evolving market.
Conclusion
Roughly speaking, the future of MicroStrategy looks bright in light of the Bitcoin halving. Optimistic predictions from experts are counting on an increase in its share price, reinforced by its increased investment strategy in bitcoin. The company also enjoys a premium placed on its bitcoin holdings, highlighting the perceived value of its crypto portfolio. With skillful financial management and a clear view of the future value of bitcoin, MicroStrategy is attracting the attention of investors seeking solid returns. Ultimately, bitcoin halving could not only consolidate its position, but also boost its growth.
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