Strategy (MSTR) Fire Sale: Should you Buy?

Zacks Rank #3 (Hold) Strategy (MSTR) is the first and largest Bitcoin Treasury company. Below are some of the reasons I am bullish into year-end:Strategy NAV is its Lowest in HistoryBecause Strategy is primarily a Bitcoin treasury company rather than a revenue-based company, investors must view it differently than most equities. Net Asset Value, or NAV, is the most optimal way to value MSTR shares. NAV is a critical financial metric to monitor when analyzing a Bitcoin treasury stock like Strategy. In Strategy’s case, NAV represents the market value of its massive Bitcoin hoard, its software business, minus its debt, divided by the number of shares. Historically, MSTR’s NAV has traded between 1.50x and 2.45x. However, currently, MSTR’s NAV of 1.10x is its lowest in history.Image Source: Zacks Investment ResearchMSTR's Forced BTC Selling Fears are OverblownBitcoin skeptic and “gold bug” Peter Schiff, along with others, has suggested that Strategy is a fraud and will be required to sell Bitcoin. However, a sizable forced selling is unlikely to occur soon, as Strategy recently raised nearly $1.5 billion by selling its own stock. Additionally, Saylor and MSTR are known for their long-term Bitcoin bullish thesis. Volatility is nothing new for the stock. In fact, in 2023, MSTR’s drawdown from its peak reached 90% before recovering all the losses. Volatility is a feature, not a bug, as without risk, MSTR’s 390% return over the past five years would be impossible. Meanwhile, MSTR has a market cap of just $45 billion while its BTC holdings are $55 billion. Any rally in Bitcoin should trigger a massive relief rally in MSTR shares, as the two are highly correlated.  Investors are Fearful Over CryptoThe “Coin Market Cap Fear and Greed Index” is a powerful tool that analyzes crypto sentiment. Late last month, the CMC Fear and Greed Index reached extreme fear levels, signaling the highest level of fear in more than two years.Image Source: Coin Market CapAs the old saying goes, investors should “be greedy when others are fearful.”MSTR: High Probability Technical ZoneFinally, MSTR is reaching a critical confluence zone from a technical perspective. The stock has retraced to the 2025 breakout zone (an area of demand), is at max oversold levels, and showed a hammer candle yesterday (indicating bulls are stepping in).Image Source: TradingViewBottom LineWhile Strategy remains a polarizing stock, many of the most significant risks appear priced in already. The combination of a historical NAV discount, panic-driven sentiment across crypto, and strong technical support provides a compelling rebound setup.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Strategy Inc (MSTR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks