Is MicroStrategy a Buy Now?
Here's a fresh look at one of the best-performing stocks over the past few years.
MicroStrategy (NASDAQ: MSTR) changed its name to Strategy on February 5 to reflect the shift in its primary business model from an enterprise software company to the largest corporate holder of Bitcoin. Since buying its first Bitcoin in August 2020, Strategy stock is up nearly 1,800%, outperforming every company in the S&P 500, including Nvidia.
Today, Strategy holds 478,740 Bitcoins worth over $41 billion, yet its market capitalization is $65 billion as of this writing. So, let's examine the reason behind the company's business model pivot and whether its long-term plans justify the discrepancy between its Bitcoin holdings and stock valuation.
Strategy primarily concentrated on its core operations as a business-to-business enterprise software provider until 2020. However, with sluggish revenue growth and surplus cash, former CEO and current executive chairman Michael Saylor allocated $250 million of the company's funds to Bitcoin, making Strategy the first publicly traded company to take this unprecedented step.
