The shares of Strategy Inc., formerly known as MicroStrategy, have plunged to a new 52-week low, trading at €117. This decline spotlights the profound risks embedded in the company’s singular corporate strategy: an all-in bet on Bitcoin. The stock now trades at a discount to the value of the Bitcoin it holds, raising fundamental questions about the sustainability of its aggressive accumulation model.
A Precarious Funding Model Stalls
The core issue unnerving market observers is a breakdown in Strategy Inc.’s primary funding mechanism. Historically, the company operated by issuing its own shares at a premium to their Net Asset Value (NAV)—the per-share value of its Bitcoin treasury. The capital raised was then used to purchase more Bitcoin. Recent analysis indicates this premium has vanished; the NAV multiplier has fallen below 1.0.
This shift creates a dangerous dynamic. Issuing new shares while trading at a discount to NAV, as the company did in late January to fund purchases, risks diluting existing shareholder value rather than enhancing it. The self-reinforcing cycle of capital raising that powered its strategy appears to be faltering.
Extreme Volatility Mirrors and Magnifies Bitcoin’s Swings
The stock’s performance is a direct reflection of its deep tether to cryptocurrency markets. Over the past twelve months, Strategy Inc.’s equity has lost more than 64% of its value. This extreme correlation is quantified by a Beta factor exceeding 3, meaning the share price not only tracks Bitcoin’s volatility but significantly amplifies it. The recent correction in Bitcoin, which fell toward the $88,000 level, has been the primary driver of the equity’s steep decline.
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Unwavering Accumulation Amid Market Stress
Despite this turbulence, the company’s management has steadfastly continued its Bitcoin acquisition program. January 2026 alone saw four separate purchase transactions. The most notable occurred on January 20, when Strategy Inc. bought approximately $2.13 billion worth of Bitcoin—its largest single transaction in over a year.
These purchases have swollen the corporate treasury to over 712,000 Bitcoin. The company’s average purchase price remains around $76,037 per Bitcoin, which still represents an unrealized gain at current market prices. However, the method of financing these large-scale buys is now under intense scrutiny.
Divergent Analyst Views Ahead of Earnings
While chart patterns and fundamental warnings flash red, some analysts maintain a longer-term constructive view. Firms including Mizuho and TD Cowen have recently reduced their price targets to $403 and $440, respectively, yet they retain their “Buy” recommendations. Their stance hinges on the long-term appreciation potential of the underlying Bitcoin holdings.
The upcoming quarterly report, scheduled for February 5, 2026, is expected to provide critical clarity. Investors will scrutinize management’s commentary for any strategic adjustment in response to the depressed NAV multiplier and whether the relentless pace of Bitcoin accumulation will be moderated under these challenging market conditions.
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