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ZEC $1,141 Strategy stock gets $208 target as MSCI delisting risk lingers
Cantor Fitzgerald lifted its Strategy target to $208 and its Bitcoin forecast to $112,000, while MSCI weighs removing the company from its indexes.
Key takeaways
- Target moves up. Cantor Fitzgerald lifted its Strategy target to $208 from $186 and kept an Overweight rating.
- Bitcoin forecast raised. Analyst Ramsey El-Assal raised his 12-month Bitcoin forecast to $112,000 from $98,000.
- Outflow estimate stands. JPMorgan analysts previously estimated that Strategy's removal could lead to about $2.8 billion in passive outflows.
What happened
Analyst Ramsey El-Assal also lifted his 12-month Bitcoin forecast to $112,000 from $98,000. The firm's updated valuation puts Strategy's enterprise value at $110 billion, up from $97 billion.
The stock traded at $147.51 in pre-market hours, down about 2.5% from its prior close of $151.29, when it gained 5.62%. Reports link the decline to speculation about an MSCI delisting. MSCI will publish its final list of affected constituents on November 11, and the new rules take effect after the November 30 market close.
Why it matters
Strategy is the largest corporate holder of BTC, with 848,250 units after a purchase announced on October 12. An earlier report said the company held approximately 848,000 BTC after buying 250 BTC. JPMorgan analysts have estimated that removal from MSCI indexes could lead to about $2.8 billion in passive outflows from MSTR.
CryptoQuant CEO Ki Young Ju argued that the MSCI risk is already priced in and pointed to higher targets elsewhere: Citigroup at $240, Barclays at $175 and B. Riley at $195. He also cited a market-cap-to-Bitcoin-NAV ratio of about 1x and a $3.75B reserve covering dividends. MSTR fell from a Thursday peak of over $151 to under $137 at Friday's close.
What is still unclear
- It is not yet known whether MSCI will include Strategy in its final list of affected constituents, which is due on November 11.
- The size of any passive outflows remains an estimate, JPMorgan's figure of about $2.8 billion has not been confirmed by actual flows.
Questions readers ask
Why is Strategy stock facing an MSCI delisting threat?
MSCI adopted new index exclusion rules targeting certain non-operating companies, and an earlier simulation identified Strategy as a potential removal. The final list is due November 11, with the rules taking effect after the November 30 close.
How much Bitcoin does Strategy hold?
Strategy holds 848,250 BTC after a purchase announced on October 12, according to CryptoPotato. An earlier CoinGape report put the holding at approximately 848,000 BTC.
What Bitcoin price forecast did the analyst give?
Analyst Ramsey El-Assal raised his 12-month Bitcoin price forecast to $112,000 from $98,000.
