MicroStrategy stock drops amid Bitcoin dip

Shares of Strategy, formerly MicroStrategy, have decreased approximately 16% year-to-date due to Bitcoin's (CRYPTO:BTC) price correction.

On February 25, 2025, MSTR stock fell over 10% to around $245, coinciding with Bitcoin dropping below $90,000 for the first time since November 2024.

MSTR closed at $282.76, with the decline happening alongside broader drops in crypto-related stocks.

At 3:59 PM EST, the stock price was $250.51.

The company’s strategy depends on raising additional capital backed by its Bitcoin holdings.

Concerns arise if liabilities exceed assets, potentially hindering capital-raising abilities.

The stock is down nearly 50% from all-time highs of $473 in November.

Strategy has spent upward of $33 billion buying BTC at an average cost of around $66,000 per coin, earning an unrealised profit of more than $10 billion.

However, analysts remain optimistic about MSTR's prospects.

Benchmark analysts raised MSTR’s price target to $650 on February 6, expressing confidence in Strategy’s ability to raise capital for Bitcoin acquisitions.

Benchmark believes in Strategy’s ability to generate “Bitcoin yield,” measured by the ratio of BTC holdings to outstanding shares, targeting 15% for 2025.

The company will also shift to fair value accounting for its Bitcoin holdings, a move aimed at providing more transparency to investors.

Other companies following similar Bitcoin treasury strategies saw comparable retraces.

For example, Semler Scientific, which started buying BTC in 2024, is down more than 20% in the year-to-date.

MSTR's premium ratio (market cap to Bitcoin holdings) decreased from 3.4 to 1.6.

This lower ratio may limit the company’s ability to raise capital for more Bitcoin purchases.

Analysts predict MSTR's price could reach $540.36, with a maximum estimate of $650 and a minimum of $409.

However, another forecast suggests that the value of MicroStrategy shares will drop by -15.35% and reach $279.91 per share by March 21, 2025.

At the time of reporting, the Bitcoin (BTC) price was $88,906.56.