MicroStrategy's stock has surged 483% due to its massive underlying Bitcoin holdings and aggressive BTC 'Pyramiding' tactic. The company's strategy involves issuing shares and debt to buy BTC, but its financials are weak, and we think the company is nearing its borrowing capacity. MSTR's valuation is extremely inflated, making it better to buy BTC directly. We recommend a pair trade: Buy BTC, Sell MSTR.
The plan is to use the additional capital ‘to buy more bitcoin as a treasury reserve asset,' the company says.
As the cryptocurrency sector remains a rollercoaster ride for investors, three heavyweights – MicroStrategy Inc. MSTR, Riot Platforms Inc. RIOT, and Coinbase Global Inc. COIN – are gearing up to release their third-quarter earnings on Wednesday.
MicroStrategy NASDAQ: MSTR is a business intelligence software company that helps organizations analyze their data to make better business decisions. But in recent years, MicroStrategy's brand has become synonymous with Bitcoin.
MicroStrategy Inc. MSTR continues its upward sprint, reaching a 52-week high of $236.29 during Thursday trading, with investors rallying behind the stock.
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It might come as a surprise to some readers that, at the moment of publication, Nvidia (NASDAQ: NVDA) is not the best-performing big name of 2024. And it isn't a media favorite like MicroStrategy (NASDAQ: MSTR) or Palantir (NYSE: PLTR) — that title belongs to Vistra Corp (NYSE: VST), a Texas-based utility company that has seen gains of 235.36% year-to-date (YTD).
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