The “digital gold” moniker of Bitcoin (BTCUSD) is fading fast, as market pressures have taken a toll on its stability. The geopolitical tension stemming from the tariffs has triggered significant volatility, exacerbating Bitcoin’s downward slide as investors digest macroeconomic uncertainty.
Bitcoin prices are approaching the critical $70,000 support level. Apart from tariff-induced volatility, the post-election surge in the cryptocurrency to over $126,000 had set the stage for investor profit-taking after a strong rally. Some analysts believe that if Bitcoin falls below $70,000, it could signal further downside for the digital asset. The crypto’s fate also depends on expectations that the U.S. Federal Reserve will take a more hawkish stance following the nomination of Kevin Warsh as Fed Chair.
However, Bitcoin bulls like Michael Saylor, the Executive Chairman of the largest corporate Bitcoin holder, Strategy (MSTR), remain optimistic about the cryptocurrency’s prospects, viewing this setback as a two-step back before a strong rally. The company last acquired 855 Bitcoins on Feb. 2 at an average cost of $87,974, showing continued commitment. Strategy holds 713,502 Bitcoins as of Feb. 5.
Strategy’s treasury model depends on the company’s shares trading at a premium to its Bitcoin holdings. However, due to the “crypto winter,” as Bitcoin prices have come down, its flexibility is under pressure, though it is not in significant financial distress at the moment. As the company uses its balance sheet and debt and equity issuances to buy Bitcoin, its diluted share count will be a closely watched metric in its fourth-quarter earnings release which will be reported today after the market closes.
So now, let's take a deeper look at Strategy.
About Strategy Stock
Strategy (previously MicroStrategy), based in Tysons Corner, Virginia, is the world's largest Bitcoin treasury firm. Founded in 1989 with a focus on enterprise analytics software, it made a bold pivot to embrace Bitcoin as its main treasury reserve asset, amassing significant holdings.
This move enables Strategy to deliver Bitcoin exposure to investors through various securities while advancing analytics technology. The firm boasts a market capitalization of $37.1 billion.
As Bitcoin goes through a pullback, MSTR’s stock has been in free-fall. Over the past 52 weeks, the stock has dropped 67.03%, while it is down 26.94% year-to-date (YTD). Strategy’s shares had reached a 52-week high of $457.22 in July 2025, but are down 71.8% from that level.
Strategy’s price-to-earnings ratio of 4.72x is lower than the industry average of 29.05x.
Strategy’s Q3 Earnings Snapshot
For the third quarter, Strategy reported a total revenue of $128.69 million, up 10.9% year-over-year (YOY) and higher than the $117.10 million that Wall Street analysts had expected.
In Q3 2025, Strategy reported operating income of $3.89 billion and EPS of $8.42, marking its second straight quarter of considerable positive earnings. This performance stems from the power of its Bitcoin holdings and the firm's ability to leverage digital credit markets. Its BTC yield was 26% as of Oct. 26, 2025, compared to the full-year target of 30%.
Wall Street analysts have a concerning view about Strategy’s bottom line trajectory. For the fourth quarter about to be reported, its loss per share is expected to increase significantly YOY to $18.06. For fiscal 2025, its loss per share is also expected to grow considerably YOY to $30.86. However, loss per share for fiscal 2026 is projected to decrease by 32.4% annually to $20.87.
What Do Analysts Think About Strategy Stock?
Recently, Canaccord Genuity analyst Joseph Vafi, one of the stock’s most vocal supporters, cut the price target from $474 to $185 while maintaining a “Buy” rating. This is based on Bitcoin’s disconnection from its “digital gold” characteristics. Vafi stated that the cryptocurrency is going through a bit of an “identity crisis.”
Analysts at Mizuho also lowered the price target last month from $484 to $403, while maintaining an “Outperform” rating. The price target update was based on Mizuho’s overall outlook on the fintech and payments sector. Additionally, analysts noted that regulatory clarity is creating a split between volatile Bitcoin and USD-backed stablecoins.
MSTR is widely followed on Wall Street, with analysts awarding it a consensus “Strong Buy” rating. Of the 16 analysts rating the stock, a majority of 13 analysts have rated it a “Strong Buy,” one analyst suggests a “Moderate Buy,” while two analysts are playing it safe with a “Hold” rating. The consensus price target of $464.36 represents a 324% upside from current levels. The Street-high price target of $705 indicates a 544% upside.
On the date of publication, Anushka Dutta did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
