Shares of MicroStrategy (MSTR), now rebranded as Strategy, are little changed in after-hours trading after the analytics software company, better known for its massive Bitcoin Holdings, reported earnings for its fourth quarter of Fiscal Year 2024. Earnings per share came in at -$3.20, which missed analysts’ consensus estimate of -$0.09 per share. Sales decreased by 3.1% year-over-year, with revenue hitting $120.7 million. This also missed analysts’ expectations of $122.45 million. However, investors are likely more interested in the company’s Bitcoin.
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MicroStrategy bought a record number of Bitcoins during the fourth quarter – 218,887 to be exact – worth $20.5 billion. As of December 31, the firm held 447,470 Bitcoins at an average cost of $62,503 per Bitcoin. This equates to a total value of $16.007 billion. In addition, the firm’s BTC yield came in at 74.3% for Fiscal Year 2024. BTC Yield measures the percent change in the ratio of Bitcoin holdings to total assumed diluted shares. This metric helps the company evaluate whether its Bitcoin buying strategy adds value to shareholders (the higher the yield, the better).
Furthermore, according to the company’s Chief Financial Officer, Andrew Kang, MicroStrategy will introduce a new key performance indicator – BTC $ Gain – and adopt fair value accounting for its bitcoin holdings in 2025. BTC $ Gain will be used to show the dollar value of the amount of Bitcoin gained.
Is MSTR a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MSTR stock based on nine Buys assigned in the past three months, as indicated by the graphic below. After a 576% rally in its share price over the past year, the average MSTR price target of $557.50 per share implies 65.58% downside risk. However, it’s worth noting that estimates will likely change following today’s earnings report.
