Strategy (MSTR), July 4th Day of Destiny Countdown..."Explodes if Clarity Act Passes"

▲ Strategy (MSTR), Bitcoin (BTC)/AI Generated Image

The eyes of Strategy (MSTR) investors are fixed on July 4th. If the US cryptocurrency market structure bill becomes a reality, MSTR, which functions as a proxy investment for Bitcoin (BTC), could again be exposed to strong volatility, according to analysis.

According to financial media Barchart on June 20 (local time), the White House has set July 4th as the target date for the US cryptocurrency market structure bill. Barchart reported that if this schedule materializes, Strategy could gain additional upward momentum. Strategy is still known as MicroStrategy and is the largest corporate holder of Bitcoin.

MSTR stock rose 5.8% on Monday with Bitcoin's rebound. However, it is still down 68% over the past 52 weeks. The stock is trading below both its 50-day moving average of $155.02 and its 200-day moving average of $195.15.

Valuations are also mixed. Strategy's market capitalization is approximately $42.35 billion. Its revenue for the last 12 months was $490.47 million. While the price-to-sales ratio is high at approximately 86x, the price-to-book ratio based on a book value of $45.64 billion is approximately 0.9x.

First-quarter earnings showed a significant divergence between surface figures and profit/loss. Revenue increased by 11.9% year-over-year to $124.3 million. Gross profit was $83.4 million. However, due to the weak Bitcoin price being reflected in accounting, operating losses of $14.47 billion and net losses of $12.54 billion were recorded.

Strategy completed a $1.5 billion debt repurchase on May 26. Its Bitcoin holdings increased to 843,738 BTC. Dollar reserves stand at $871 million. On June 8, shareholders approved a proposal to change STRC dividends from once a month to twice a month.

Wall Street evaluations remain favorable. Clear Street raised its price target to $240 and maintained a "buy" rating. Canaccord lowered its price target to $163 but maintained a "buy" rating. Mizuho set a price target of $265 with an "outperform" rating, and BTIG maintained its price target of $350 with a "buy" rating. Barchart reported that the average price target of $363.62 implies a 199% upside from the recent price.

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