TD Cowen defends bullish stance on Strategy with $440 price target

Core Viewpoint - TD Cowen maintains a $440 price target for Strategy (NASDAQ: MSTR), indicating a 170% upside from the January 21 share price of $162 [1] Group 1: Company Strategy and Performance - Strategy raised $1.25 billion in early January to acquire an additional 13,627 bitcoins, accelerating its accumulation strategy during the recent price dip [1] - As of the report, the company held 687,410 bitcoins, which increased to over 700,000 bitcoins this week [2] - The treasury operation is projected to generate $6.315 billion in value for shareholders by 2026, with an expectation to accelerate Bitcoin acquisition in the second half of the year as prices rise [4] Group 2: Market Outlook and Projections - TD Cowen views the recent slump in Bitcoin prices as a temporary depression, allowing Strategy to lower its average cost basis [2] - The $440 price target relies on a 5x multiple of projected 2026 Bitcoin value gains, assuming Bitcoin recovers to approximately $177,000 by December 2026 [3] - A cryptocurrency yield of 7.1% is projected for 2026, a decrease from prior forecasts due to higher equity issuance [3] Group 3: Investment Opportunities - Higher Bitcoin prices are expected to drive both the premium and yield higher, with opportunities identified across the company's capital structure, particularly within its five tranches of preferred stock [5] - Senior preferred shares trade at a discount and offer a 9.6% implied yield, with potential for capital appreciation if yields compress to 7.6% [5]