Wall Street analysts covering Strategy ( MSTR ) largely agreed on one point after the company’s fourth-quarter earnings Thursday: The overall losses look dramatic, but they don’t signal a liquidity crunch or forced bitcoin selling.
Strategy reported an operating loss of DKK 17.4 billion. USD and a net loss of 12.6 billion. price drop. Both TD Cowen and Benchmark said the market reaction missed that context, sending shares down about 17% on a day when bitcoin and other risk assets were already under pressure.
Shares are up 21% on Friday as bitcoin climbs from yesterday’s lows of $60,000 to back above $70,000.
The two analysts agree that the core debate is about solvency, not profitability. The strategy holds 713,502 bitcoin, worth nearly $50 billion at current prices, against about $8.2 billion in convertible debt. Benchmark analyst Mark Palmer said the company would only face real balance sheet stress if bitcoin fell below $8,000 and stayed there for years. Management emphasized on the earnings call that none of its debt has covenants or triggers tied to bitcoin’s price or its average purchase cost.
TD Cowen’s Lance Vitanza also focused on the sustainability of the capital structure. He argued that the strategy was built to amplify bitcoin’s volatility by design, with common stocks trading at around 1.5 times bitcoin’s volatility. That leverage cuts both ways. Vitanza said the company’s $2.25 billion cash reserve and staggered debt maturities mean there is no reasonable scenario where strategy would be forced to sell bitcoin in the near term, even if prices remain depressed.
Where analysts differ is less about risk and more about framing. Leaning into Strategy’s role as a “digital credit engine,” TD Cowen highlighted its growing preferred stock business and the liquidity of its STRC preferred stock, which pays an 11.25% annual dividend. Benchmark placed more emphasis on bitcoin’s long-term price path and the option embedded in the strategy’s equity if bitcoin rises.
Both companies remain constructive on the stock. Benchmark reiterated a Buy rating with a price target of $705, based on a sum-of-the-parts model that assumes bitcoin will reach $225,000 by the end of 2026. TD Cowen also maintained a Buy rating, arguing that the strategy remains one of the most effective ways for investors to gain leveraged bitcoin, although it did not disclose specific bitcoin exposure outside of the ETF.
