Shares of Strategy have experienced a period of significant turbulence, declining approximately 68% from their November 2024 peak. In the midst of ongoing debates concerning the company’s fair valuation, a notable insider transaction has provided a long-awaited signal to the market. For the first time in years, a member of the executive board has made a substantial purchase, even as the firm continues to aggressively expand its Bitcoin holdings.
Analyst Sentiment Adjusts to New Realities
The shifting landscape has prompted reactions from research analysts. On January 16, Japan’s Mizuho Bank revised its price target for Strategy downward, moving from $484 to $403. The bank maintained its “Outperform” rating, citing potential political and macroeconomic factors that could impact the sector in 2026. Despite the recent challenges, the stock trades at a forward P/E ratio of 2.53, which remains significantly below the sector average of 11.77.
The share price showed signs of stabilization last week, closing at $173.71 on Friday and posting a weekly gain of over 10%. Technical analysts suggest the $165 level now represents a key support zone. For a sustainable trend reversal toward resistance levels near $220, a decisive breakout above the $193 to $200 range would be necessary.
Insider Purchases After a Prolonged Drought
Breaking a lengthy pattern of disposals, board member Carl Rickertsen executed a meaningful purchase this week. He acquired 5,000 shares at an average price of $155.88, representing an investment of roughly $780,000. This transaction marks his first buy since June 2022, ending a three-and-a-half-year period during which he was noted exclusively for share sales. Market observers attribute this move to the stock’s normalized valuation. Whereas investors in November 2024 were paying a 240% premium above the value of Strategy’s Bitcoin treasury, that premium has now nearly evaporated. The company’s market capitalization of $67 billion sits close to the $64 billion value of the Bitcoin assets on its balance sheet.
Should investors sell immediately? Or is it worth buying Strategy?
Persistent Strategy Faces Investor Scrutiny
Despite the severe price depreciation, the company’s core strategy remains unchanged. Between January 5 and 11, Strategy purchased an additional 13,627 Bitcoin for approximately $1.25 billion. This acquisition was financed, once again, through the issuance of new shares.
This approach is drawing criticism from several angles:
* Shareholder Dilution: The recurring issuance of new equity exerts downward pressure on earnings per share.
* Substantial Fixed Costs: Annual commitments for interest and dividend payments total between $300 million and $340 million.
* Core Business Performance: The traditional software operations are barely profitable.
To cover interest payments for the coming twelve months, the company has already announced plans to issue further shares worth $1.44 billion. Analysts view this as a structural risk, noting that debt obligations are being serviced primarily through capital raises in the absence of significant operational profits.
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