TD Cowen: The strategy for the Bitcoin acquisition engine is robust, maintaining a "buy" rating and a target price of $535.

TD Cowen's research report published in November 2025 points out that the accumulation model of Bitcoin by Strategy remains intact amidst recent market fluctuations, with preferred stock issuance activities enhancing support for its continued acquisition capabilities. The company acquired approximately 6,890 Bitcoins with the net proceeds of $703.9 million raised from the Euro-denominated preferred stock IPO, while the issuance of variable rate preferred stocks unexpectedly increased during the sharp decline in Bitcoin prices.

Analysts maintain a “buy” rating on the Strategy stock (MSTR) with a target price of $535, emphasizing that its Bitcoin per share content continues to rise, even as the net asset value premium narrows to 1.2 times.

Innovation of Financing Mechanism and Capital Operation

The preferred stock financing strategy of Strategy demonstrates resilience in volatile markets. The issuance scale of euro-denominated perpetual preferred stock has expanded from the initially planned 350 million euros to 620 million euros (approximately 716.8 million USD), with an oversubscription rate of 1.8 times, indicating strong demand from European investors for yield products. Meanwhile, the variable rate Series A perpetual extended preferred stock (STRC) saw a surge in issuance during the fall of Bitcoin, raising a nominal value of 131.4 million USD.

These preferred stock instruments offer a dual advantage: they avoid immediate dilution for common shareholders while providing predictable low-cost funding—the 10% Series A perpetual preferred stock dividend rate is well below the company's historical equity return rate. Ryan Yoon, a senior analyst at Tiger Research, pointed out: “The strategy has successfully attracted a distinct group of yield-focused investors who seek lower volatility than common stocks.”

Analysis of Bitcoin Holdings Rise and Per Share Content

Despite the significant challenges in the market environment, the Bitcoin per share content of Strategy continues to rise. TD Cowen data shows that the company deployed $703.9 million to acquire 6,890 Bitcoins at an average price of approximately $102,200, bringing the total holdings to 649,870 coins. On a fully diluted basis, each share represents 0.036 Bitcoins, an increase of 18% compared to the beginning of 2024.

This growth is entirely driven by preferred stock financing, and the common stock ATM program was not utilized during this period. It is worth noting that even if the price of Strategy shares falls 57% from the historical high of $473.83 in November 2024, its Bitcoin acquisition capability remains unaffected, proving the separation of the financing model from stock price performance. This structure allows the company to accelerate accumulation during market pessimism, forming a unique counter-cyclical investment capability.

Strategy Financing and Position Key Indicators

• Euro Preferred Stock Financing: 620 million euros (approximately 716.8 million USD)
• Variable Rate Preferred Stock: $131.4 million face value
• This week's Bitcoin acquisition: 6,890 coins (worth 703.9 million USD)
• Total open interest: 649,870 Bitcoins
• Bitcoin per share content: 0.036 coins (fully diluted basis)

Changes in Valuation Indicators and Market Position

The core valuation metric of Strategy, mNAV (market cap to Bitcoin net asset value ratio), has compressed from a peak of 2.5 times in 2024 to 1.2 times, reflecting the market's reassessment of the premium for Bitcoin leverage exposure. This compression is partly due to the competition from Bitcoin ETFs—investors can now gain more “pure” Bitcoin exposure through products like IBIT and GBTC, without bearing the operational risks of companies.

However, the Strategy still maintains a unique value proposition: the leverage effect obtained through preferred stock financing amplifies returns in a bull market, and the company has the ability to actively manage the timing of acquisitions. Historical data shows that when the mNAV is below 1.5 times, the average return rate of Strategy stocks over the subsequent 12 months reaches 85%, indicating that the current valuation range may provide long-term investment opportunities.

Who are the competitors of Strategy?

The digital asset financial governance model created by Strategy is facing competitive pressure. Valuations of similar companies such as BitMine Immersion Technologies and Nakamoto Holdings have encountered more serious erosion, with mNAV ratios generally falling to the range of 0.8-1.0 times. Traditional enterprises are also beginning to explore Bitcoin reserves; although companies like Japan's Metaplanet and America's Tesla are smaller in scale, they have diverted market attention.

The regulatory environment is also evolving: the SEC is tightening its accounting treatment of digital asset holding companies, requiring more detailed disclosure of the liquidity risks and market risks associated with Bitcoin holdings. These changes are forcing Strategy to continuously optimize its financing structure, with the latest euro-denominated product being an innovative initiative aimed at attracting international investors and diversifying regulatory risks.

Strategy Risk Factors and Investment Framework

Investors need to pay attention to several key risk points. In terms of liquidity, the trading volume of Strategy preferred stocks is low, and urgent liquidations may face significant discounts. Regarding leverage risk, if the price of Bitcoin falls below the average holding cost of $74,433, it may trigger margin calls for financing contracts. Regulatory risk is always present, as the United States may classify Bitcoin as a security, changing tax treatments and capital requirements.

For investors considering investment, it is recommended to adopt a three-layer analysis framework: first, assess the long-term prospects of Bitcoin; second, analyze the sustainability of Strategy's financing capacity; and finally, judge whether the mNAV ratio provides sufficient safety margin. Based on current data, the 1.2 times mNAV is close to historical lows and may have reflected most of the pessimistic expectations.

When a business model can continuously evolve across cycles, its value often surpasses short-term price fluctuations. The financing flexibility and execution capability demonstrated by the Strategy during market turbulence prove that it has transformed from a simple Bitcoin agency into a mature digital asset treasury management platform. This transformation not only tests investors' understanding but also redefines the role of listed companies in the cryptocurrency ecosystem.

FAQ

How can Strategy finance the acquisition of Bitcoin without diluting common stock?

Mainly through the issuance of preferred shares, including euro-denominated perpetual preferred shares and variable interest rate preferred shares, these instruments attract yield investors and do not immediately dilute the equity of common shareholders.

What is the current Bitcoin holding amount for Strategy?

As of November 16, 2025, Strategy holds 649,870 Bitcoins, with a total cost basis of $48.37 billion and an average cost of $74,433.

What is the mNAV ratio? Why is it important?

mNAV is the ratio of the company's market value to the value of the Bitcoin held, measuring the extent of the premium given by the market. Currently, at 1.2 times, it is close to historical lows, reflecting a significant narrowing of the premium.

What is TD Cowen's rating and target price for Strategy?

Maintain a “buy” rating, with a target price of $535, based on the sustainability of its Bitcoin per share growth and preferred stock financing capability.

What advantages does Strategy have compared to Bitcoin ETF?

By leveraging preferred stock financing to achieve leverage effects, actively managing acquisition timing, and potentially amplifying returns during a bull market, but also bearing the operational and financing risks of the company.