MicroStrategy (MSTR), the largest company holding Bitcoin and long considered a leveraged bet on crypto, has lost nearly $18 billion in market value as enthusiasm has dried up and its net asset value (mNAV) premium has collapsed in recent months.
The stock could be poised to rebound as a series of key catalysts could reverse the downtrend as soon as this week, according to a new report from Markus Thielen of 10x Research, who had previously been bearish on the name.
“At today’s price, with the NAV premium largely gone, volatility trending higher, and a potential catalyst in the form of strong third-quarter earnings and further speculation about S&P 500 inclusion, we view the strategy as attractive at current levels,” Thielen wrote, noting that the stock here could offer better value than bitcoin itself.
The stock’s fall below $280 (down 1.8% on Wednesday) left the market capitalization barely above the value of bitcoin on the company’s balance sheet. That marks a sharp reversal from late 2024, when speculative premiums, Thielen said, pushed the stock well above its fundamentals.
While the 40% decline since July has “wiped out” sentiment and retail interest is weak, the company’s earnings report Thursday could mark a turning point, Thielen said.
He expects the company to report a profit of around $3.6 billion from market value gains on its BTC holdings. The profit could reset speculation about a possible decision to be included in the S&P 500 Index in December – a move that Thielen has now assigned a 60% to 70% probability to.
The stock’s inclusion in one of the world’s largest stock indexes could generate up to $28 billion in passive and active fund flows, setting up MSTR for a rally similar to that seen in Coinbase (COIN) and Robinhood (HOOD) following their inclusions in the S&P 500.
“Surrender always feels like the end, until it quietly marks the beginning,” Thielen said.
Read more: The strategy of Saylor, the first Bitcoin treasury company rated by a major credit agency
