Table of Contents :
• Stock Rating & Target Price
• Investment Thesis
• Fundamental Models Used
• Company Description
• Corporate Timeline
• Key Metrics (KPI ) and Recently Reported Earnings Review
• Business Highlights, Strategic Announcements & Outlook
• Quarter-over-Quarter (Q-o-Q) and Year-over-Year (Y-o-Y) Growth Analysis
• Key Catalysts Driving Growth
• Historical Financial Statement Analysis & CAGR Trends
• Quarterly Key Financial Ratios and Performance Metrics
• Annual Financial Performance Analysis: Horizontal and Vertical Financial Analysis, Trends
• Financial Forecasts
• Annual Forecasts: Income Statement
• Annual Forecasts: Cash Flow Statements
• Net Debt Levels
• A Closer Look at DCF: Our Assumptions and Methodology
• Terminal Value Calculation
• Target Price Analysis
• Valuation Multiples
• Supplementary Valuation Analysis: Multiples Approach
• Scenario/Sensitivity Analysis – Base Case , Bull Case ,Bear Case
• Holistic Peer Review & Trading Comps: Financial Data, Operational Metrics, and Valuation Multiples
• Implied Price Per Share
• Ownership Activity/ Insider Trades
• Ownership Summary
• An analysis of ESG Risk Rating
• Key Professionals
• Key Board Members
• Key Risks Considerations
• Analyst Ratings
• Analyst Industry Views
• Disclosures
MicroStrategy (MSTR): Leveraging the 21-21 Capital Strategy to Accelerate BTC Holdings – Will Intelligent Leverage and New Accounting Rules Transform Losses into Billion-Dollar Profits?
MicroStrategy's strategic pivot from an enterprise software firm to a Bitcoin-centric investment vehicle has resulted in a staggering 1,700% increase in stock price since 2020. However, the company reported a 10% year-over-year revenue decline in Q3 2024, totaling $116.1 million, primarily due to weaknesses in its core software business. Despite three consecutive quarterly losses, MicroStrategy remains committed to increasing its Bitcoin position through a planned $42 billion capital raise aimed at generating annual BTC yields of 6-10%. The anticipated accounting rule changes in 2025, which would allow Bitcoin assets to be marked to market value, could substantially enhance reported earnings and drive a stock re-rating. The company's recent shift to a cloud-based model shows promise, with subscription revenue growing 32% year-over-year, indicating a strategic transition toward sustainable, recurring income. Additionally, the firm's proactive capital markets activity has improved financial flexibility, enabling early debt redemption and unencumbering Bitcoin holdings. Looking ahead, as institutional acceptance of Bitcoin increases and macro tailwinds strengthen, the question is: Will MicroStrategy's intelligent leverage and upcoming accounting changes successfully transform its current losses into significant profits, solidifying its position in the digital asset landscape?
