MicroStrategy's Stock: A Closer Look at Its Adjusted Value

Markus Thielen of 10x Research believes the stock is closer to its true value. In March, his firm estimated MSTR's fair price at around $1,000, advising that investors might prefer direct Bitcoin investments. As of Friday, MicroStrategy'smarket cap was $21.37 billion, with 214,400 BTC on its books, valued at $13.26 billion.

Often seen as a stand-in for a Bitcoin ETF, MicroStrategy doesn't have the typical mechanisms of ETFs like market makers or redemption processes, which allows its stock price to vary widely based on market sentiment. MicroStrategy uses unique tactics such as issuing cheap debt to buy more Bitcoin or selling stock at a premium.

Earlier this year, such strategies led to criticisms due to the very high premium on the stock, which some said was unjustified. However, supporters argue that the premium anticipates the company's ability to acquire more Bitcoin per share in the future.

James Butterfill of CoinShares states that MSTR acts like a leveraged bet on Bitcoin, usually moving 1.5 times with Bitcoin's price. He notes that monetary policy influences the company's stock more than typical business fundamentals. Butterfill also remarked that the recent Bitcoin price drop was an overreaction to the FOMC's tentative monetary policy shift, which later adopted a more supportive stance. He predicts that this will stabilize both MSTR and Bitcoin prices soon.