MicroStrategy in Unique Position to Benefit From Rising Bitcoin Price: Berenberg

MicroStrategy (MSTR) is in a unique position among publicly listed companies to benefit from an increase in the price of bitcoin (BTC), German investment bank Berenberg said in a report Thursday.

Berenberg initiated coverage of the stock with a buy rating and a $430 price target. The shares slid about 2% in premarket trading Friday to $312.

The business analytics software company founded by Michael Saylor, now executive chairman, is the largest corporate holder of bitcoin as a balance sheet treasury asset. It owns about 140,000 bitcoins that it paid an average price of $29,800 for. The stash is worth about $4.1 billion at current prices.

MicroStrategy's shares offer an “attractive way for investors to gain exposure to bitcoin and to navigate the digital asset space amidst the ongoing regulatory crackdown,” analyst Mark Palmer wrote.

“Bitcoin has emerged as a safe haven relative to other crypto tokens,” Palmer's note said. If investors “increasingly turn to bitcoin as an alternative currency amidst macro-related fears, then MicroStrategy shares stand poised to benefit.”

The fourth bitcoin halving, scheduled for May 2024, may serve as a positive catalyst for bitcoin's price and by extension, for MicroStrategy shares, the note added.

MicroStrategy is scheduled to report its first-quarter earnings after the market closes on Monday.

Read more: MicroStrategy’s Bitcoin Holding Doesn’t Necessarily Pose a Concentration Risk: Bernstein