If Bitcoin Recovers $120,000... Strategy's $400 Scenario for 2027

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

A forecast has emerged that if Bitcoin (BTC) recovers $120,000, the stock price trend of Strategy, the world's largest Bitcoin holder, could completely change. 24/7 Wall St. set a base scenario target price of $254.93 for Strategy's stock, currently at $129.60, anticipating an upside potential of approximately 97%, and opened up to $391.94 in a bullish scenario.

According to investment media Yahoo Finance on September 16 (local time), Strategy currently holds 846,000 BTC, making it virtually an investment vehicle that amplifies and reflects Bitcoin's price. The stock price, at approximately $130, has fallen by 60.46% over the past year and 14.71% since the beginning of the year. Bitcoin rose to $82,283 intraday on September 3, then retreated to $75,584 on September 15, and as a result, Strategy's stock price also fell by 5.07% in the past week. The stock's beta is 3.597, indicating a structure highly sensitive to Bitcoin price fluctuations.

24/7 Wall St.'s base scenario target price of $254.93 represents a 96.7% upside potential compared to the current stock price. In a bullish scenario, it projected $391.94. Wall Street's consensus target price is $226.20, with 2 'Strong Buy' ratings, 12 'Buy' ratings, and 1 'Hold' rating, with no 'Sell' opinions. However, for the price to reach $400, it would need to rise by 208.6% from the current $129.60, which the outlet described as a challenging goal rather than a base scenario.

The key condition presented is Bitcoin's recovery to $120,000. Strategy currently holds 846,000 BTC at an average cost of approximately $76,000. The outlet analyzed that if Bitcoin surpasses $120,000, unrealized losses on its holdings could turn into substantial profits, earnings per share (EPS) could become positive, and the market capitalization to net asset value (mNAV) premium could expand. Strategy CEO Phong Le stated that the company increased its Bitcoin holdings by 11% while reducing the size of its convertible bonds by 18% to $6.7 billion.

On the other hand, risk factors are also apparent. Strategy recorded a net loss of $8.22 billion in Q2 due to Bitcoin impairment charges, and Polymarket reflects a 78% chance of its exclusion from the MSCI index by year-end. The outlet explained that such uncertainties are factors limiting institutional investor purchases. It pointed out that if Bitcoin declines again, concerns about stock dilution could reignite, and particularly if a bear market persists below $70,000, the $400 scenario itself could be jeopardized.

Ultimately, to reach $400, Bitcoin must recover and maintain its price above $120,000, the risk of MSCI index exclusion must be favorably resolved, and Strategy must continue to increase its Bitcoin holdings per share through capital raising. The company increased its Bitcoin holdings per share by 5% in Q2 alone. The outlet stated that if these conditions are met, a path to $400 by 2027 could open, but given the 208.6% increase required, it presented this as a bullish scenario rather than a base forecast.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*