PANews reported on December 22 that according to Barron's, the Bitcoin premium of MicroStrategy's stock (measured by the ratio of enterprise value - market value plus net debt - to the value of the company's Bitcoin holdings) continues to shrink. The company is currently valued at about twice the value of its Bitcoin holdings, with a holding of about 439,000 Bitcoins (Barron's estimates). This ratio has dropped from a peak of 3.5 times in November to twice the current level, indicating that MicroStrategy's stock price has failed to keep up with the recent correction in Bitcoin prices after breaking through $100,000. Given that there is still a high Bitcoin premium in the stock, MicroStrategy's stock price may face more downside. Currently, MicroStrategy's market value is about $79 billion, of which Bitcoin holdings are worth about $43 billion. The company also has $7 billion in debt. Excessive premiums may make MicroStrategy's stock price prone to corrections when the premium further shrinks.
Analysis: MicroStrategy's valuation has dropped to twice the market value of its BTC holdings, and its stock price may face downward space
Comment
Recommend Reading
- 2024-12-22
Barclays: The Fed is expected to stop cutting interest rates after June next year until mid-2026
- 2024-12-22
Gold advocate Peter Schiff: Someone has created USAcoin, but don’t buy it
- 2024-12-22
BTC falls below $97,000, down 0.56% on the day
- 2024-12-22
Hut 8 CEO: Building a strategic Bitcoin reserve based on operational strategy and capital management choices
- 2024-12-22
CZ: I don’t know how to calculate that the UAE holds $40 billion worth of Bitcoin, the number is higher than expected
- 2024-12-22
Michael Saylor releases Bitcoin Tracker information for the seventh consecutive week, possibly hinting at another increase in BTC holdings