MicroStrategy (NASDAQ:MSTR) stock has been one of the year’s biggest breakout stocks so far. The multi-faceted technology company is up more than 340% over the past six months alone. This impressive growth is due mostly to its high exposure to Bitcoin (BTC-USD). As BTC prices have surged over the past few months, so has MSTR stock.
Bitcoin has been rising steadily for weeks, due primarily to the upcoming halving event expected on April 20. This event is one of the most important milestones for crypto markets, as it will reduce the supply of Bitcoin. This could send prices even higher, depending on how the value of the crypto holds up.
As long as BTC keeps rising, so will MSTR stock. With anticipation for the next Bitcoin halving sky-high, investors can expect both names to keep trending upward as this key date draws closer.
What’s Happening With MSTR Stock?
While trading has been fairly volatile today, MSTR stock remains in the green. As of this writing, shares are up around 6% for the day. Of course, the past month has been fairly turbulent. But through it all, MicroStrategy has managed to stay mostly up as Bitcoin optimism helps keep the stock in focus.
Wall Street is optimistic about MicroStrategy’s growth prospects following the halving. Mark Palmer of Benchmark recently raised his MSTR stock price target from $990 per share to $1,875, implying upside of more than 20%. The analyst cited a “supply shock” as a likely catalyst, based on how previous halvings have impacted BTC prices.
As MarketWatch reports:
“Palmer said he believes MicroStrategy will continue to use capital raises and excess cash from its software business to stock up on bitcoin, and estimates the company will have 298,246 bitcoins by the end of 2025 […] He also believes the stock could benefit from earnings, which are projected to be released at the end of April […] not because of the company’s software business, but because of new accounting standards for companies that hold digital assets on their balance sheets. The new standards will allow the companies to measure their crypto assets at fair value.”
With that in mind, it’s easy to see why some experts think MicroStrategy’s winning streak will continue even after the event. Investing in Bitcoin has served the company extremely well. Now, not only is it reaping the rewards — it’s offering investors significant exposure to a booming market.
What Comes Next?
As InvestorPlace contributor Chris MacDonald notes, MicroStrategy’s foray into Bitcoin began in 2020 as a means of safeguarding against inflation. Over time, though, the company has accumulated 214,246 BTC and become the “leading corporate holder” of the crypto. It’s safe to say that this investment strategy has paid off in more ways than one. It’s hard to argue with one-year gains of almost 400%.
Granted, there’s no guarantee as to how the 2024 Bitcoin halving will play out. But if Palmer’s bullish thesis is correct — or even in the ballpark — MSTR stock could ride its current wave to even greater highs in the second half of the year.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
