After Citron Research disclosed a short position in the stock, claiming it is “overheated,” MicroStrategy (NASDAQ:MSTR) shares fell dramatically to $397.28 on Thursday, reversing earlier gains.
Activistic short seller Citron observed on social networking site X that it had suggested MicroStrategy almost four years ago as a main vehicle for Bitcoin (BTC) investment, assigning a $700 price target at the time
However, following the stock’s superb run-up, Citron contended that trading activity for the stock deviates from BTC principles. The company cited the growing availability of direct cryptocurrency investments through ETFs and platforms like Coinbase (NASDAQ:COIN) and Robinhood (HOOD) as reasons MicroStrategy is less necessary for BTC exposure.
Citron said it had hedged its perspective with a short position against MicroStrategy, even though it maintained a positive outlook on BTC. Supported by robust investor attitude toward BTC markets, MicroStrategy shares remain up 78% from Election Day and have gained 529% YTD despite Thursday’s selloff.
This article first appeared on GuruFocus.
