Strategy, formerly known as MicroStrategy, experienced a significant stock downturn in late 2025, hitting a fresh yearly low. Despite its aggressive Bitcoin accumulation strategy, the company's stock faced intense pressure from multiple fronts, creating a challenging environment for investors while sparking debate among market analysts.
A Steep Decline and Looming Delisting Threats
MSTR stock plunged to $155.32, marking a 71% crash from its 2024 high and reverting to its $100-$180 price range. A primary driver of this bearish sentiment was the increasing risk of MSCI delisting MSTR and other "crypto treasury firms" from its global index. Despite founder Michael Saylor's defense of the company as an operational entity, prediction markets indicated a high probability (+75%) of delisting in early 2026. Such a move, according to JPMorgan analysts, could trigger an estimated $8 billion in outflows, though speculation about a forced liquidation of MSTR's extensive Bitcoin holdings remained subdued. The MSCI's mid-January decision is highly anticipated to provide much-needed clarity on the stock's immediate future.
Dilution Strategy and Bitcoin Accumulation
Adding to the stock's woes has been the ongoing dilution of MSTR shares to finance its substantial Bitcoin acquisitions. In a notable shift from its stated policy, Strategy reportedly sold $4 billion worth of MSTR common stock in November and December, even when its enterprise value relative to net assets (mNAV) dipped below 1. This contradicts earlier commitments to avoid issuing common stock if mNAV fell below 2.5x, later revised to 1x. Throughout 2025, Strategy poured $22.5 billion into Bitcoin purchases, nearly half of its total BTC investment since 2020, bringing its total holdings to 672,497 BTC. The latest $108 million Bitcoin acquisition was entirely funded by MSTR stock sales, highlighting the firm's relentless pursuit of its Bitcoin strategy.
Wall Street's Confident Outlook
Despite the significant stock depreciation and the underlying pressures, a surprising sentiment persists among Wall Street analysts. In the past month, MSTR received 13 "buy" ratings, with ambitious price targets ranging from $465 to $485. These projections imply a substantial 170%-200% upside potential, suggesting that a segment of the market remains highly bullish on Strategy's long-term prospects, perhaps viewing the current downturn as a temporary setback for its Bitcoin-centric strategy.
