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<p><span style="font-weight: 400">MicroStrategy’s share price, which is mainly driven by its Bitcoin (BTC) holdings, is “exceptionally high“ and “unjustifiable,” argues investment firm Kerrisdale Capital.</span></p>
<p><span style="font-weight: 400">Investors have inflated MicroStrategy’s premium as a result of the company’s BTC holdings. The majority of this BTC was bought through debt financings, equity linked convertible notes and ATM equity offerings, said the firm in a Mar. 28 analyst </span><a href="https://www.kerrisdalecap.com/wp-content/uploads/2024/03/MicroStrategy-MSTR.pdf" rel="noopener noreferrer nofollow"><span style="font-weight: 400">note</span></a><span style="font-weight: 400">.&nbsp;</span></p>
<p><span style="font-weight: 400">Calling the company’s use of leverage to purchase more BTC “intelligent” is flawed logic, it added.</span></p>
<p><img decoding="async" src="https://solutionsreview.com/business-intelligence/files/2020/02/oie_G94ppYhlnSBi.jpg" alt="MicroStrategy 2020 Launches with New HyperIntelligence Functionality"></p>
<h2 id="span-style-font-weight-400-bitcoin-etfs-could-make-microstrategy-redundant-span"><span style="font-weight: 400">Bitcoin ETFs Could Make MicroStrategy Redundant&nbsp;</span></h2>
<p><span style="font-weight: 400">The launch of Spot </span><a href="https://insidebitcoins.com/news/michael-saylor-says-bitcoin-etfs-and-ai-will-ignite-a-decade-long-gold-rush-for-btc" rel="noopener noreferrer nofollow"><span style="font-weight: 400">Bitcoin ETFs</span></a><span style="font-weight: 400"> (exchange-traded funds) in the U.S. might reduce the need for investors to trade MicroStrategy stocks to gain exposure to Bitcoin, the firm added.</span></p>
<p><span style="font-weight: 400">MicroStrategy (</span><a href="https://www.google.com/finance/quote/MSTR:NASDAQ?sa=X&amp;sqi=2&amp;ved=2ahUKEwiTqa-ijJmFAxW1VKQEHU1pBNkQ3ecFegQIRRAf" rel="noopener noreferrer nofollow"><span style="font-weight: 400">MSTR</span></a><span style="font-weight: 400">) no longer presents investors with “a rare, unique way to gain access to Bitcoin,” it said in the note.&nbsp;</span></p>
<p><span style="font-weight: 400">Kerrisdale Capital said that MicroStrategy’s “sleepy software analytics business” only makes up 3% of the company’s collective value. Other reasons that argue in favor of MSTR’s value, such as the ability to buy more BTC using the software company’s cash flows, its access to liquidity, the lack of management fees and how easy it is to trade MSTR are all “weak,” the note added. Analysts at the investment firm therefore said they “ are short shares of MicroStrategy.”&nbsp;</span></p>
<h2 id="span-style-font-weight-400-michael-saylor-maintains-a-positive-outlook-for-the-company-span"><span style="font-weight: 400">Michael Saylor Maintains A Positive Outlook For The Company</span></h2>
<p><span style="font-weight: 400">Michael Saylor, the CEO at MicroStrategy, has continually expressed his confidence in the company’s ability to remain attractive to investors. One thing that gives MicroStrategy an edge over spot Bitcoin ETFs, apart from not charging fees, is the leverage it offers investors, Saylor said in a December interview with Bloomberg TV.</span></p>
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 <p lang="en" dir="ltr"><a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">#Bitcoin</a> is Better. <a href="https://t.co/UkZR7t6UEP" rel="noopener noreferrer nofollow">pic.twitter.com/UkZR7t6UEP</a></p>
 <p>— Michael Saylor⚡️ (@saylor) <a href="https://twitter.com/saylor/status/1773331288511893651?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">March 28, 2024</a></p>
</blockquote>
<p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p>
<p><span style="font-weight: 400">More recently, the CEO also revealed that the company will be rebranded as a “Bitcoin development company.” He called this a “natural decision,” in a Feb. 12 </span><a href="https://www.cnbc.com/video/2024/02/12/microstrategy-co-founder-michael-saylor-theres-10-years-of-pent-up-demand-for-these-bitcoin-etfs.html" rel="noopener noreferrer nofollow"><span style="font-weight: 400">interview</span></a><span style="font-weight: 400"> with CNBC, given the success of MicroStrategy’s Bitcoin </span><a href="https://insidebitcoins.com/news/microstrategy-buys-37-million-more-bitcoin-bringing-total-to-8-1-billion-as-michael-saylor-says-btc-is-now-institutional-grade-asset" rel="noopener noreferrer nofollow"><span style="font-weight: 400">investment</span></a><span style="font-weight: 400">.</span></p>
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“Exceptionally High” MicroStrategy Share Price Is Driven By Debt-Financed BTC Holdings, Investment Firm Says

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