What Happened?
Shares of bitcoin development company Strategy (NASDAQ: MSTR) fell 13.4% in the morning session after the price of Bitcoin fell sharply and a key analyst significantly lowered their price target on the stock.
As the world's largest corporate holder of Bitcoin, Strategy's stock price is closely linked to the digital asset's performance. The cryptocurrency's value fell below $70,000, reaching levels not seen since late 2024. This drop prompted Canaccord Genuity analyst Joseph Vafi to slash his price target on Strategy by over 60%. The analyst noted the cut was mainly because the slip in Bitcoin's price reduced the value of Strategy's large crypto holdings. The stock's decline also occurred as investors awaited the company's fourth-quarter earnings report, which was scheduled for release after the market closed.
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What Is The Market Telling Us
Strategy’s shares are extremely volatile and have had 56 moves greater than 5% over the last year. But moves this big are rare even for Strategy and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 22 days ago when the stock gained 3% on the news that the company announced it had purchased an additional 13,627 bitcoins for approximately $1.25 billion. This purchase, the company's largest since July 2025, brought its total holdings to approximately 687,410 bitcoins, cementing its position as the largest corporate holder of the digital asset. The acquisition was funded through the sale of stock.
Strategy is down 27.4% since the beginning of the year, and at $114.16 per share, it is trading 75% below its 52-week high of $455.90 from July 2025. Investors who bought $1,000 worth of Strategy’s shares 5 years ago would now be looking at an investment worth $1,416.
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