According to Berenberg Capital, the upcoming halving of Bitcoin in April 2024 could set the stage for an increase in MicroStrategy’s stock price.
Michael Saylor, co-founder and executive chairman of the technology company, is such a deep believer in the Bitcoin philosophy that he has adopted it within MicroStrategy’s books.
Let’s take a look at all the details together.
Bitcoin halving: bullish forecast for the MicroStrategy stock
Bullish predictions for the future of MicroStrategy shares emerge from analysts at Berenberg Capital, especially in view of the upcoming halving of Bitcoin, the main asset on the company’s balance sheets.
In particular, Bitcoin 4th halving, which will halve the rewards of miners to 3.125 BTC per mined block, could push the cryptocurrency’s price to new price horizons, positively impacting MicroStrategy’s profits.
In fact, the business intelligence firm based in Tysons Corner, Virginia, represents the private company with the highest number of Bitcoin deposited on its balance sheet, amounting to 152,333 BTC to be exact, with a current value of $4.64 billion.
Michael Saylor, co-founder of MicroStrategy and cryptocurrency maximalist, applies the DCA technique to manage the company’s purchases, periodically adding a “small” share of digital gold to the portfolio.
Below is a chart depicting the price levels at which such purchases have been made by MicroStrategy.
For a company that holds such a large sum in Bitcoin on its balance sheet, it is a foregone conclusion that an appreciation of the asset would convert into an increase in share value, which analysts at Berenberg Capital say could soon reach $430.
Bitcoin’s halving, expected in April 2024, should open the door to bullish scenarios for the cryptocurrency and hence also for MicroStrategy, at least if we take past data as the case.
Historically, each halving has resulted in a bull market for all cryptocurrencies, which at each four-year date record killer performances.
This time, with perfect timing, it also intersects with the issue of an alleged approval of a spot Bitcoin ETF, proposed in early June by asset management firm BlackRock.
In this regard, 19 March 2024, or about a month before the 4th halving of rewards of network miners, is the last deadline for the SEC’s final response, which will have to approve the ETF or provide valid reasons for a rejection.
Stock market: not only MicroStrategy among list of most promising companies
As we await yet another halving of Bitcoin, MicroStrategy stock price forecasts are getting more and more interesting.
Since the beginning of the year, the company’s shares are up more than 200% with a current price of $407 and price action strongly on the upside.
However, watch out for short-term speculation because the stock has reached an overbought level in the RSI these very days and could thus perform a retracement.
If we broaden the horizons we can well understand that if Bitcoin were to break above the recent ATH at $69,000 in the next bull run, then MSTR could easily return to $1300, which would mean an increase of about 320% from current values.
MicroStrategy’s stock performance echoes in a very familiar way the movements of the first cryptocurrency by market capitalization, precisely because as mentioned earlier, most of the company’s balance sheet is denominated in BTC.
The next price targets for MSTR are $450 and then $600, waiting to land at higher levels that probably will not be reached before the Bitcoin halving.
In any case, MicroStrategy is not the only promising company that is performing well in the stock market: stocks such as Apple, Microsoft, nvidia, Tesla, and The Trade Desk are very quickly recovering all the ground lost during the 2022 price drop.
All US tech companies in general have led the bullish momentum of the Nasdaq and S&P500 in this first half of 2023, posting double-digit percentage increases.
While Bitcoin and MicroStrategy are still far from their all-time highs, many listed companies have returned to their respective all-time highs, albeit experiencing less volatility.
Nvidia in particular surpassed its ATH in May this year, demonstrating incredible strength and very high shareholder interest.
