Financial firm TD Cowen has set a price target of $440 for MicroStrategy (MSTR) stock, underscoring confidence in the company's aggressive Bitcoin-centric corporate strategy. This target revision follows the company's reported fourth-quarter operating loss of $17.4 billion and a net loss of $12.6 billion, figures largely driven by non-cash accounting tied to Bitcoin's price decline.
Analysts from both TD Cowen and Benchmark emphasized that the headline losses do not signal a liquidity crisis or forced Bitcoin selling. They argue the core issue is solvency, not profitability. MicroStrategy holds 713,502 bitcoins, valued at nearly $50 billion at current prices, against approximately $8.2 billion in convertible debt. Benchmark analyst Mark Palmer noted the company would only face true balance-sheet stress if Bitcoin fell below $8,000 and remained there for years.
Management, led by Executive Chairman Michael Saylor, stressed on the earnings call that none of its debt carries covenants tied to Bitcoin's price. TD Cowen's Lance Vitanza focused on the durability of the capital structure, stating the company was built to amplify Bitcoin's volatility by design. He argued that with a $2.25 billion cash reserve and staggered debt maturities, there is "no reasonable scenario" where MicroStrategy would be forced to sell Bitcoin in the near term.
The market reaction was volatile. Following the earnings report, MSTR shares fell about 17% in a single day as Bitcoin and other risk assets faced pressure. However, shares subsequently soared 21% the next day as Bitcoin rebounded from around $60,000 to above $70,000.
While both firms maintain constructive views, their framing differs. TD Cowen leans into MicroStrategy's role as a "digital credit engine," highlighting its growing preferred equity business. Benchmark places more weight on Bitcoin's long-term price path, reiterating a Buy rating with a $705 price target based on a model assuming Bitcoin reaches $225,000 by the end of 2026. Saylor has described the company's strategy as building a "digital fortress anchored by 713,502 bitcoins."
