STRATEGY IS ABT TO SHOCK WALLSTREET
MSTR for the first time ever gets to use the new accounting rules of FASB which allows them to show the unrealized profit from their bitcoin holdings as their earnings. Which IMO they should have been able to for a long time. Basically they can report how much their bitcoin postion value has increased since their cost basis. Most analysts do not understand this which is why I have seen many of them expect the stock to have a negative EPS still. Now that they can use the fair value accounting rules I could see a $30 EPS but the question is, is this priced in or does wall street still not understand MSTR. Link to the earnings calls at 2pm PST Webinar Registration - Zoom Now if I had to bet I would expect the stock to push up higher on earnings in the range of 10% to 20% if they do a monster beat. The question is will it hold, as many people will just say bitcoin is too volatile and their gains could just get wipe away next quarter. What I did see today on insider trading was a lot of employees were buying massive shares using their discount. (see image below). From a technical perspective we have a nice cup and handle pattern forming (bullish). Many analysts recently raised their price targets to the $620 to $680 range. However the options market is mixed bullish and bearish. Retail traders were showing large buys this week ahead of the earnings calls, while larger institutions seem to be shorting to hedge their positions. For fun I asked Grok 4 heavy, the newest LLM from Xai. Here was the response I received. I tried to use AI for every good and bad case scenario, and they all show the same thing. MSTR is a 90% chance to open above 500 on Friday... GROK: I estimate MSTR’s EPS at ~$39.5, while analysts expect -$0.1. I predict the stock will open at ~$500 after earnings, driven by the significant earnings surprise and market reaction. Our higher estimate reflects a deeper analysis of fair value accounting and Bitcoin gains, which Wall Street may not have fully priced in yet.