What's Going On With 'Bitcoin Developer' MicroStrategy Stock?

MicroStrategy Incorporated MSTR shares are trading at all-time highs Wednesday as the price of Bitcoin breached the $73,000 mark. 

The Details:

The company acquired an additional 12,000 Bitcoin for approximately $821.7 million on Monday, bringing its total holdings to approximately 205,000 Bitcoin at an average purchase price of approximately $33,706 per coin.

Michael Saylor, Bitcoin advocate and executive chairman of MicroStrategy, was interviewed by CNBC and Yahoo Finance on Tuesday and said that Bitcoin is "digital property", and he has no plans to ever sell his Bitcoin holdings. 

MicroStrategy received significant price target increases from analysts on Tuesday. Canaccord Genuity analyst Joseph Vafi maintained the stock with a Buy rating and raised the price target from $975 to $1810, and TD Cowen maintained MicroStrategy with an Outperform and raised its price target from $1220 to $1560.

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MSTR Stock Forecast 2030:

Predicting the future in stock prices over long periods of time is challenging. Wall Street analysts use complex models that take into account interest rates, economic growth, competitive advantages, management teams and historical profitability, among a host of other factors.

If, as an investor, you want to assume most of the major factors remain stable, you can use trend analysis as a helpful tool. Using a longer term trend line or historical performance of the stock, you can aim to forecast a stock's annual rate of return.

For MicroStrategy MSTR, over the past 5 years, it's annualized stock performance is 60.77%, and if you assume that trend continues for another 5 years, you can expect a stock to trade at $17,405.

Using a trend line (see how to perform this function here), If you choose to use a trend line, connect your two points and look into the future to the point in time in which you're curious. Once you've identified that stock price, you may want to consider what type of conditions would need to exist for the stock to justify the share price – be it an outside influence or managerial decision making.

MSTR Price Action: According to Benzinga Pro, MicroStrategy shares are up 9.2% at $1,740 at the time of publication.

Image: Mohamed Hassan from Pixabay