Cantor Fitzgerald analysts significantly lowered their price target for Strategy shares in a Friday note, while reiterating an “Overweight” rating for the Bitcoin-buying firm that holds approximately $58 billion in BTC.

The investment bank penciled in a 12-month price target of $229 for Strategy’s stock, around 59% lower than its previous $560 estimate. Still, Cantor underscored its positive outlook for the company, which has seen shares slide more than 50% over the past six months.

The adjustment reflects a decline in the value that the analysts apply to Strategy’s treasury operations, which fell to $74 per share from $364 per share. Over the next year, the analysts now expect Strategy to raise $7.8 billion from capital markets, as opposed to $22.5 billion.



The analysts noted that some market participants fear “crypto winter is here”—another way to describe an extended market downturn, where prices fall and investor interest cools. At the same time, they described some “fear-mongering” toward Strategy as overblown.

Strategy shares fell to $178 on Friday, according to Yahoo Finance, erasing gains on the week. The price of Bitcoin meanwhile dropped below $90,000. Bitcoin has fallen by nearly 30% since setting a new high above $126,000 in early October.

The analysts said that they have “very little reason to believe” that Strategy would ever be forced to sell its Bitcoin, even as its reliance on issuing preferred shares to buy Bitcoin has grown. These preferred shares offer dividend payments, but they are not guaranteed.

On Monday, Strategy established a $1.44 billion “cash reserve” to effectively cover dividend payments for nearly two years. The analysts highlighted that none of Strategy’s convertible debt, totaling $8.2 billion, matures until 2028.

What’s more, it’s unlikely that Strategy’s Bitcoin-buying activity will cease purely because the price of Bitcoin has recently gone lower, the analysts said. However, the largest corporate holder of Bitcoin has acknowledged the possibility of selling it, under certain conditions.

If there was one fear that was “somewhat warranted,” it would be Strategy’s removal from MSCI’s indices, the analysts added. Last month, JPMorgan posited that Strategy’s removal from global finance company’s products could spark $2.8 billion in outflows.

Strategy has historically added to its Bitcoin stockpile by issuing common stock. However, that move has become a less effective way for the company to increase the amount of Bitcoin that it owns per share, as its market cap has slipped below the value of its crypto holdings.

The analysts highlighted that the dynamic, reflected by a drop in Strategy’s so-called mNAV, has been cyclical. That includes the lows of 2022, as well as the highs of last year.

This week, several institutions have offered updated price targets for Strategy’s stock, as shares hover near a 13-month low. Although TD Cowen grew bearish, Benchmark remained bullish.

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