MicroStrategy (MSTR) is on track to make a big leap this month, with expectations it will join the Nasdaq 100 on December 23. According to Bloomberg Intelligence analyst Eric Balchunas, the announcement could come as soon as this week. This move will place MicroStrategy among the Nasdaq’s top 100 companies by market value. This exposes it to a huge influx of institutional capital.
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Nasdaq 100 Inclusion Brings Massive Attention
What does this mean for MicroStrategy? Well, it’ll be among the 100 largest companies on the Nasdaq by market cap, which is no small deal. MSTR will likely make up about 0.47% of the index, which translates into serious exposure, especially since the Nasdaq 100 is tracked by billions in ETFs. For example, Invesco QQQ Trust, with more than $322 billion in assets, will now hold MSTR, according to Balchunas. He also mentioned that this will likely push Moderna (MRNA) out of the index.
Bitcoin Bet Pays Off Big Time
But let’s not forget why this is happening in the first place. Since 2020, MicroStrategy’s co-founder Michael Saylor has been making huge Bitcoin bets, purchasing nearly $25 billion worth. The strategy has clearly paid off—MicroStrategy now holds over 425,000 Bitcoin, worth around $42 billion. As Bitcoin continues to rise, so does MicroStrategy’s stock, which has jumped a staggering 2,500% since 2020.
MicroStrategy’s stock has surged thanks to its Bitcoin bets, but analysts warn that if financing conditions change, the company could be exposed to financial vulnerabilities.
Is MicroStrategy a Good Stock to Buy Now?
Analysts remain bullish about MSTR stock, with a Strong Buy consensus rating based on a unanimous eight Buys. Over the past year, MSTR has skyrocketed by more than 550%, and the average MSTR price target of $529.57 implies an upside potential of 28.7% from current levels.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
