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TD Cowen raised its bitcoin forecasts but kept its $260 price target on Strategy (MSTR), warning that dilution and financial obligations could limit gains for common shareholders. Analysts Lance Vitanza and Jonnathan Navarrete maintained their Buy rating, while noting that preferred-stock repurchases and cash reserves may absorb some of the per-share benefit of higher bitcoin prices.
Why it matters
Strategy's bitcoin holdings do not translate directly into equivalent upside for MSTR shareholders. Debt and preferred shares, including STRC, STRF and STRD, have claims ahead of common stock. TD Cowen said bitcoin ownership per MSTR share has been less robust after accounting for those claims.
The company is also directing some funds raised toward cash reserves and support for preferred shares rather than immediate bitcoin purchases. That may help attract investors and fund future buying, but leaves less capital available for bitcoin in the near term.
Market impact
Strategy shares fell about 2.5% to $150 and were down nearly 5% year to date. TD Cowen's unchanged $260 target implies roughly 73% upside. The stock has rebounded from a stretch between late June and mid-August when it struggled to break above $100. Its valuation has recovered to roughly 1.0 times net asset value after touching 0.63 in June.
Strategy holds 848,000 BTC, with about $4.5 billion in unrealized profits. TD Cowen projects bitcoin near $109,000 at the end of 2026 and $280,000 by 2029, above QCP Capital's $80,000 to $90,000 fourth-quarter base case. Bitcoin traded near $81,300 on Thursday and remained down 9% year to date. The gap between bitcoin's outlook and MSTR's per-share economics remains central to the equity case.
Frequently asked questions
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Why did TD Cowen keep its $260 target on Strategy despite raising bitcoin forecasts?
The analysts said dilution and financial obligations could limit how much higher bitcoin prices benefit common MSTR shareholders.
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Which claims rank ahead of common MSTR shareholders?
Strategy's debt and preferred shares, including STRC, STRF and STRD, have claims ahead of common shareholders.
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How is Strategy using some of the money it raises?
The company is building cash reserves and supporting its preferred shares, rather than directing all raised funds immediately toward bitcoin purchases.
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What are TD Cowen's updated bitcoin projections?
TD Cowen's model puts bitcoin near $109,000 at the end of 2026 and $280,000 by 2029.
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How did Strategy shares and bitcoin perform year to date in the report?
Strategy shares were down nearly 5% year to date after falling about 2.5% to $150. Bitcoin traded near $81,300 and was down 9% year to date.
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