Strategy resumed issuance under its variable-rate Stretch preferred stock program, funding over half of Monday's $50 million Bitcoin acquisition
Bitcoin News
TD Cowen estimates Strategy will acquire 6,720 Bitcoin following its €620 million euro-denominated preferred stock offering. Analysts Lance Vitanza and Jonnathan Navarrete said the perpetual Stream preferred stock priced at €80 per share represents Strategy's entry into euro-based Bitcoin-backed credit markets.
Strategy will deploy €608.8 million in net proceeds to acquire Bitcoin at an estimated average $104,500. Accounting for common-share issuance needed to fund STRE dividends over 10 years, TD Cowen projects net gains of 4,235 Bitcoin. The issuance should push Strategy's year-to-date Bitcoin yield above 27%, approaching the company's 30% target for 2025.
Strategy resumed issuance under its variable-rate Stretch preferred stock program, funding over half of Monday's $50 million Bitcoin acquisition. Last week's $26.2 million in STRC issuance exceeded total capital raised across all other preferred classes. STRC shares trade near $100 par with dividend rates adjusted to maintain price stability at a current 10.5%.
Strategy now holds 641,692 Bitcoin valued around $67 billion. TD Cowen initiated buy ratings on STRE euro-denominated shares and STRC shares while reiterating buy ratings on existing STRF, STRK, and STRD classes.
The firm set a €119 target for STRE shares with 5.2x Bitcoin coverage and $100 par target for STRC shares with 5.5x coverage. Targets include $140 for STRK convertible preferreds with 4.7x coverage, $112 for STRD preferreds with 4.3x coverage, and $126 for STRF preferreds with 7.2x coverage.
The preferred securities offer income and appreciation potential with lower expected volatility than common shares or spot Bitcoin products, according to analysts. TD Cowen maintained its $141,277 base-case Bitcoin price assumption by Dec. 31, with an upside scenario of $160,000 and a downside scenario of $60,000.
The base-case model assumes approximately $4 billion in quarterly Bitcoin acquisitions by Strategy. The upside scenario assumes over $4.5 billion, while the bear case projects suspended acquisitions due to adverse market conditions. Bitcoin reached an all-time high around $126,000 on Oct. 6.
TD Cowen maintained a $535 price target on MSTR common stock, representing 124% upside from Monday's $238.88 closing price. The target reflects estimated intrinsic Bitcoin value per share as of December 2027, when analysts forecast Strategy will hold approximately 815,000 BTC.
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