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MicroStrategy shares soared to a 24-year high on Monday, fueled by the recent rapid rise in Bitcoin prices to near-record levels.
Investors have been trading in shares of MicroStrategy, which is essentially a business analytics software company.
MSTR
Given the years of building Bitcoin, there is a strong sense of play in the digital asset.
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will be accumulated as a major national treasury asset.
The stock rose 24% in afternoon trading, its highest closing price since March 2000.
It soared 92% during the six-day winning streak. This is the longest six-day rally since the 10-day rally that ended on Nov. 10, 2023, and the largest six-day rally since the six-day 100.6% rally that ended on Feb. 9, 2021, according to Dow Jones Markets. be. data.
The company’s market capitalization has increased by $10.7 billion over the past six trading sessions, reaching $22.4 billion on Monday.
Last week, benchmark analyst Mark Palmer became the biggest bull on MicroStrategy’s stock since he initiated coverage on February 27 with a buy rating and a $990 price target. The stock was already trading around 33% above target.
Palmer said Wall Street’s top-line target is based on the assumption that Bitcoin will reach $125,000 by the end of 2025. Bitcoin recently rose 6.9% to trade at $67,334, just below the $68,990 it hit in just over two years, according to FactSet. Before.
Bitcoin’s big rally (60.4% year-to-date) comes after regulators approved several spot Bitcoin exchange-traded funds and ahead of the next “halving” expected to occur in April. woke up.
In the latest update on MicroStrategy’s Bitcoin holdings, the company said it paid $155.4 million to acquire 3,000 Bitcoin in the 10 days ending February 25, for an average price of $51,813 per Bitcoin. was. At current Bitcoin prices, the value of the acquired Bitcoins has already increased by approximately $46.6 million.
The company announced that it held a total of approximately 193,000 Bitcoins as of February 25th, which it acquired for approximately $6.09 billion at an average price of $31,544 per Bitcoin. At current prices, the value of the holdings is approximately $13 billion.
In a post-earnings conference call with MicroStrategy analysts in early February, co-founder and executive chairman Michael Saylor said 2024 is Bitcoin’s “birth year” as an institutional asset class. He said he was confident that it was.
“And this completes the first 15 years of Bitcoin’s lifecycle. And in the first 15 years, primarily [an] “Unregulated retail assets are misunderstood,” Saylor said, according to a FactSet transcript. “I predict that the next 15 years will be a period of high, institutionally regulated growth for Bitcoin.”
The correlation coefficient between MicroStrategy stock and Bitcoin over the past year was 0.95, according to calculations from FactSet data by MarketWatch. A reading of 1.00 means they work perfectly together.
Meanwhile, the correlation between MicroStrategy stock and the SPDR S&P Software & Services ETF XSW, of which it is a component, is 0.80.
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