TD Cowen trims MicroStrategy target — but still sees big upside TD Cowen cut its price target for Strategy (MSTR) from $400 to $260 while keeping a “buy” rating, citing a simpler reason than you might expect: a more conservative long-term Bitcoin (BTC) forecast, not a vote of no confidence in the company’s new capital plan. Why the cut matters — and why it’s not a sell signal - The lower target reflects TD Cowen’s reduced BTC price outlook. The firm explicitly separated its Bitcoin assumptions from its view of Strategy’s corporate moves, and said the new $260 target still implies roughly 200% upside from current trading levels. - TD Cowen also described Strategy’s recently announced capital framework as “incrementally positive,” saying it could boost the company’s financial flexibility over time. What Strategy has changed - On June 29 the company filed a Digital Credit Capital Framework that would allow it to raise up to $1.25 billion through Bitcoin sales. Proceeds could be used to shore up U.S. dollar reserves, pay preferred dividends, meet interest obligations, increase cash, and fund future share buybacks. - Management also authorized repurchases of up to $1 billion of its Digital Credit Securities (STRC, STRF, STRD, STRK) if buybacks would strengthen the balance sheet. - As part of its capital-management move, Strategy paused additional Bitcoin purchases and sold roughly $1.15 billion of MSTR shares. Market reaction and the Saylor signal - The stock rallied more than 12% the day before the TD Cowen note after the financing framework was announced, though it later gave back some gains. - Michael Saylor stoked chatter on June 28 by posting Strategy’s Bitcoin tracker with the caption “We’re gonna need more charts.” Past tracker posts have preceded BTC buys, and investors speculated another purchase could be coming. Recent buys, holdings and the accumulation challenge - Strategy reported buying 520 BTC on June 22 for about $35 million at an average price of $67,068, bringing its tracker-reported holdings to 847,363 BTC. - Market volatility has weighed on the company’s model: Strategy’s market net asset value (mNAV) fell below 1.0 for the first time this cycle — to about 0.80 after BTC dipped under $60,000. When MSTR trades below the value of its Bitcoin holdings, issuing new shares at a premium becomes harder and risks diluting shareholders. - Management has said issuing common equity when mNAV is below roughly 1.22x can be value-destructive on a per-share basis, prompting some investors to argue that restoring a valuation premium should take precedence over further BTC accumulation. Pushback and broader debate - The new framework has its critics. Some worry that explicit permission to monetize Bitcoin could dampen market sentiment if the company sells BTC, and Ripple CEO Brad Garlinghouse has publicly criticized Strategy’s role during the recent crypto market decline. - That tension highlights Strategy’s tightrope walk: Michael Saylor continues to advocate long-term Bitcoin holding, even as the company pursues tools to manage liquidity, dividends and capital structure amid a choppier market. Bottom line TD Cowen’s cut is more a recalibration of Bitcoin’s long-term path than a rebuke of Strategy’s strategy. Investors will likely watch two things closely: whether Strategy resumes buying BTC and how its new capital tools are deployed — moves that could reshape both the company’s risk profile and investor sentiment. Read more AI-generated news on: undefined/news