CNBC‘s Jim Cramer recently urged investors to own Bitcoin directly rather than investing in MicroStrategy (MSTR) (a data analytics firm with a massive Bitcoin stash) as a proxy. During a recent Mad Money segment, Cramer advised viewers to include Bitcoin in their portfolios. “I own Bitcoin, you should own Bitcoin,” he said.
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Cramer’s comments are a significant shift from his previous stance on cryptocurrency. Indeed, in late 2022, following the collapse of crypto exchange FTX, Cramer said that he would not touch crypto in a million years due to regulatory concerns. It is also worth noting that Cramer specifically advised against investing in MicroStrategy despite the company being the largest corporate holder of Bitcoin.
Although he did not elaborate on the reason why to avoid MicroStrategy, it is likely due to the fact that the firm is significantly leveraged. In fact, the company has raised billions of dollars worth of debt in order to build its Bitcoin stash, which is currently valued at around $48 billion. As a result, Cramer’s comments suggest that he believes investors can benefit more from owning Bitcoin directly rather than through MicroStrategy, as it is likely to be more volatile and carry company-specific risks.
Is MSTR a Good Stock to Buy?
Overall, analysts have a Strong Buy consensus rating on MSTR stock based on eight Buys assigned in the past three months, as indicated by the graphic below. In addition, after a 710% surge in its share price over the past year, the average MSTR price target of $529.57 per share implies 42.7% upside potential.
