MicroStrategy Stock Price in 5 Years: Where Will MSTR Stand by 2029?

MicroStrategy has made headlines for its unwavering commitment to Bitcoin. Under the leadership of Michael Saylor, the firm has transformed itself into one of the world’s largest corporate holders of Bitcoin.

But what lies ahead for the biggest Bitcoin holder in the world?

Year-To-Date MSTR Stock Performance

Throughout 2024, MicroStrategy (MSTR) has shown significant volatility , largely influenced by its extensive investments in Bitcoin.

The stock has experienced a strong upward trend, with a notable increase of approximately 542% since the start of the year, climbing from around $69 to over $400, its highest level ever.

MSTR touched $540 on Thursday, Nov. 21, 2024, but has since dropped down to $406 on Wednesday, Dec. 4.

The stock started the year at $69.25 and continued with a depressed trend until March when Bitcoin hit a new record high several times.

Factors driving this surge include strategic Bitcoin purchases and favorable market conditions. However, the stock also faced short-term pullbacks, reflecting the inherent volatility associated with cryptocurrency-related assets.

Short-Sellers Hit MSTR Stock

MSTR stock was hit by the news that Citron Research, led by Andrew Left, is shorting MicroStrategy , asserting that the software company has effectively transformed into a Bitcoin investment fund.

According to Citron Research, with the emergence of Bitcoin ETFs, investors can directly invest in Bitcoin without relying on MicroStrategy’s stock for indirect exposure.

MicroStrategy has issued approximately $10.5 billion of equity since Oct. 31, with most of it being sold under its $42 billion strategy.

Citron Research highlighted the increasing accessibility of Bitcoin investments and suggested that MicroStrategy’s stock price no longer reflects Bitcoin’s fundamentals.

Citron’s short position on MicroStrategy adds to the growing list of investors betting against the company. According to Fintel data , there are currently 22 short positions against MicroStrategy, with a total short value of over $4 million.

Disappointing Third Quarter

MicroStrategy, the largest corporate Bitcoin holder, has revealed its Q3 2024 results , spotlighting its ambitious new “21/21 Plan” to raise $42 billion over the next three years. According to CEO Phong Le, the plan aims to allocate $21 billion each from equity and fixed income to expand the company’s Bitcoin holdings and optimize BTC yield.

In Q3, MicroStrategy raised $2.1 billion through equity and debt, increased its Bitcoin holdings by 11%, and reduced annual interest expenses by $24 million. The company also executed a 10-for-1 stock split on August 7 and continued share buybacks, reinforcing its focus on shareholder value.

On Sept. 30, MicroStrategy held 252,220 Bitcoin  worth $6.85 billion at cost and $16 billion at market value. Despite this, software revenue declined 10.3% year-over-year to $116.1 million, and gross profit dropped to $81.7 million. Operating expenses surged to $514.3 million, driven by $412.1 million in digital asset impairment losses.

The firm reported a net loss of $340.2 million, up from $143.4 million in Q3 2023, and ended the quarter with $46.3 million in cash reserves.

More Bitcoin Purchases To Come

MicroStrategy has not slowed its acquisition path of Bitcoin and has continued to make purchases of the digital asset. According to its latest filing  with U.S. regulators, MicroStrategy has completed a purchase of 15,400 BTC for $1.5 billion at a price of $95,967 per BTC.

The company completed its $3 billion offering of 0% convertible senior notes, continuing its strategy to acquire more BTC.

MicroStrategy initially aimed to raise $1.75 billion, but strong investor demand led the company to increase the offering to $2.6 billion. The funds raised will primarily be used to expand its Bitcoin holdings further.

 

The net proceeds from the sale, amounting to roughly $2.97 billion after discounts and commissions, will be used to buy more Bitcoin and for general corporate purposes.

As of Dec. 5 2024, MicroStrategy holds 402,100 BTC  worth approximately $38 billion. This puts the firm $4 billion short of achieving its “21/21 plan,”  which would see the firm raise that figure to $42 billion by 2027.

2023 Surge

MicroStrategy’s stock performance in 2023 was exceptional, soaring by over 300%. This remarkable growth was primarily attributed to the company’s substantial Bitcoin holdings, which have increased in value alongside the broader Bitcoin market.

The company’s decision to invest heavily in bitcoin was initially met with skepticism from some analysts and investors. However, the surge in Bitcoin prices in 2023 has validated MicroStrategy’s strategy and rewarded those who invested in the company’s stock.

In addition to the Bitcoin gains, MicroStrategy’s software business also showed signs of improvement in 2023.

The company’s subscription revenue grew by 38% year over year, helping to offset declines in product licenses and support revenues. Overall, MicroStrategy’s financial performance in 2023 was strong, and the company may continue its growth in the future.

This remarkable performance has made MicroStrategy one of the biggest gainers in the U.S. equity market in 2023.

The company’s success is due to its innovative approach to business and its willingness to take risks.

While the stock’s future performance may depend on the further growth of the Bitcoin market, MicroStrategy’s strong fundamentals and diversified business model suggest that the company may continue its success in the years to come.