TD Cowen Defends Strategys Stock Valuation Against Critics, Citing Strong Bitcoin Accumulation

Analysts at TD Cowen have termed the critics’ claims about the inflated stock price of Strategy as «logically flawed,» according to a report by The Block.

They argue that the company’s approach to issuing securities and raising capital does not dilute, but rather enhances the share of Bitcoin for each investor.

The premium to Strategy’s net asset value stands at 72.6%, reflecting the difference between the market capitalization of $124.3 billion and the value of Bitcoin held on the company’s balance sheet, which is $72 billion.

Critics refer to this as a «greater fool theory,» suggesting that investors are overpaying for shares, hoping to resell them at even higher prices. However, TD Cowen analysts disagree, asserting that the premium is justified by MSTR’s ability to raise low-cost capital for Bitcoin purchases, generating returns that are not accessible to retail investors.

As a recent example, they highlighted a transaction in which Strategy sold shares worth $739.8 million to acquire 6,220 BTC. As a result, the Bitcoin share per MSTR has increased by 20.8% since January 1, and more than doubled in the past 18 months.

The company continues to raise funds, recently launching its fourth series of perpetual preferred shares for new cryptocurrency purchases.

Currently, it holds 607,770 BTC, making it the largest public Bitcoin holder. TD Cowen projects that by the end of 2027, the company will accumulate nearly 900,000 BTC, which would account for 4.3% of the total supply of this digital asset.

Additionally, the investment bank raised its target stock price for Strategy from $590 to $680 and forecasted that Bitcoin could reach $155,000 by year’s end.