It's Time To Back The Truck Up On MicroStrategy (MSTR)

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I'm Adding More Microstrategy (MSTR)

If you're in crypto, it's unforgiveable at this point if you're not aware of Michael Saylor, the 30-year veteran CEO of MicroStrategy (MSTR). The executive has become one of the strongest proponents for Bitcoin, having converted all of his company's cash reserves into it. Most recently, MicroStrategy increased its reserves with a zero-interest convertible bond to bring his total BTC holdings up to 91,326 BTC.

What makes Microstrategy a great investment to add to any stock portfolio is its outsized and direct interest in an asymmetrical store of value investment. The company serves as a great proxy investment to diversify one's exposure into the crypto markets. More so, it can be put into a Roth IRA, for example, to amplify the potential inflation hedge with tax-free benefits.

I fully expect that MicroStrategy will stay within the range seen below as defined by the volume-weighted averages of people buying in at the recent low and those selling out at the recent highs. This is denoted by the red and green lines respectively.

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Given that we're nearing the potential bottom as defined by this channel, now would seem like a good time to begin averaging into a position. Granted all of this is entirely dependent on the stability of Bitcoin at these levels, which is arguable in itself. But MicroStrategy treasury reserves holds at least $4.6 billion of asset value at these current levels, not including the value of its main data-analytics business.

Microstrategy currently trades with a market cap of $5.77 billion based off the share price of approximately $600/sh. In 2020, the company brought in $480 million in revenue leading to free cash flow of almost $50 million. While it competes aggressively in a competitive field, the company remains cash flow positive in a data analytics field that is only expected to rise in demand as data continues to grow and the ability to analyze it becomes more and more convoluted.

Posted Using LeoFinance Beta



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