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Key Takeaways

• Mizuho cut Strategy’s price target from $586 to $484 but kept its “Outperform” rating following Q3 results.
• Strategy reported Q3 EPS of $8.42 with $2.8 billion net income and holdings of 640,808 Bitcoin, representing over 3% of all Bitcoin in existence.
• The stock dropped 14.4% this week and moved down 43% year-to-date as Bitcoin prices declined.
• Strategy’s market cap of $49 billion barely exceeds its Bitcoin holdings value of $46 billion, closing the premium gap.
• The company raised $700 million through preferred stock with a 10% annual interest payment to fund operations.

Strategy stock certainly took a beating this week. Shares fell 14.4% as Bitcoin prices dropped to around $80,000 before recovering to $85,000 by Friday, Nov. 21, 2025.
 

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The decline comes just weeks after Mizuho adjusted its outlook on the company. On Nov. 10, the investment firm lowered Strategy’s price target from $586 to $484 while maintaining its “Outperform” rating. The revision followed Strategy’s third quarter results announced on Oct. 30.

Strategy reported strong Q3 numbers with earnings per share of $8.42. The company posted operating income of $3.9 billion and net income of $2.8 billion. Total revenue reached $128.69 million, up from $116.07 million in the same quarter last year.

Revenue growth came from Product licenses and Subscription services. The company’s Bitcoin holdings reached 640,808 coins by the end of Q3. That represents more than 3% of all Bitcoin in circulation.

Strategy has raised $19.8 billion for Bitcoin purchases so far in 2025. The company recorded a 26% Bitcoin yield year-to-date through fair-value accounting. This added $18 billion to digital asset equity.

The Premium Has Vanished

Strategy has historically traded at a premium to its Bitcoin net asset value. That gap has closed in 2025. The stock moved down 43% year-to-date while Bitcoin only dropped 10%.

The company’s market cap sits at $49 billion. The value of its Bitcoin holdings minus debt equals $46 billion. The premium that once made Strategy attractive has nearly disappeared.

Funding through stock offerings has become harder as prices fall. Strategy recently turned to a different approach. The company sold preferred stock that raised $700 million. This preferred stock comes with a 10% annual interest payment. It adds cash to the balance sheet but increases funding costs.

Share Dilution Continues

Strategy has been raising funds to buy Bitcoin since 2020. The company’s shares outstanding have risen 199% over the last five years. Despite this dilution, the stock was up 667% over that same period as Bitcoin prices soared. Those trends are now reversing. The falling Bitcoin price makes it harder to efficiently raise capital through equity offerings.

Management plans to maintain flexibility through multiple funding sources. These include ATM issuances, equity offerings, Bitcoin derivatives, and market-specific instruments. The company also plans to fund preferred stock dividends through these channels.

Strategy aims to educate banks, insurance companies, and investors about Bitcoin adoption. Management believes institutional acceptance and compliance are crucial for industry growth.

The company faces challenges beyond Bitcoin price volatility. Its high leverage introduces operational risk. Strategy may encounter execution or regulatory hurdles as it pursues international expansion and ambitious BTC yield targets.

As of Nov. 21, Bitcoin had recovered to around $85,000 after briefly touching the $80,000 mark earlier in the week.

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