Analysis: MicroStrategy's valuation has dropped to twice the market value of its BTC holdings, and the stock price may face downward pressure

According to Barron's Weekly, the Bitcoin premium of MicroStrategy's stock (measured by the ratio of enterprise value - market value plus net debt - to the value of the company's Bitcoin holdings) continues to shrink. Currently, the company's valuation is about twice its Bitcoin holdings, with a holding of approximately 439000 bitcoins (Barron's Weekly estimates). This ratio has dropped from a peak of 3.5 times in November to twice its current level, indicating that MicroStrategy's stock price has failed to keep up with the recent rebound in Bitcoin prices after breaking through $100000. Given the still high Bitcoin premium in the stock market, MicroStrategy's stock price may face more downward space. Currently, MicroStrategy's market value is about $79 billion, of which Bitcoin holdings are worth about $43 billion. The company also carries $7 billion in debt, and a high premium may make MicroStrategy's stock price prone to a pullback when the premium further shrinks.