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MicroStrategy’s Crypto Moves: A Game-Changer or Risky Bet?

Bryce TuoheyAvatar
Written by Bryce Tuohey Reviewed by Tim Sykes Fact-checked by Matt Monaco
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MicroStrategy Incorporated’s shares are rising following the company’s recent announcement to purchase more Bitcoin, signaling strong market confidence and interest in their cryptocurrency strategy, which has positively impacted their stock price. On Wednesday, MicroStrategy Incorporated’s stocks have been trading up by 6.4 percent.

Recent Developments

  • MicroStrategy joined force with Zebra Technologies to upgrade Zebra’s Workforce Optimization Suite using its AI-driven business insight solutions. This move aims to deliver improved analytics through generative AI for better customer decisions.

Candlestick Chart

Live Update At 11:37:43 EST: On Wednesday, December 11, 2024 MicroStrategy Incorporated stock [NASDAQ: MSTR] is trending up by 6.4%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

  • In an ambitious stride, MicroStrategy recently sold over 5.42M shares, raising $2.13B to acquire 21,550 bitcoins. This purchase brings their total to a whopping 423,650 bitcoins, every coin bought at an average of $60,324.

  • Major digital currencies, notably Bitcoin, witnessed a sharp ascent, breaking $99,000. Crypto-friendly enterprises like MicroStrategy are reaping benefits as the coin rallies close to its historical peak.

  • On the trading front, MicroStrategy observed a 6.2% surge in pre-market trades, following a previous day’s strong 8.7% hike, amid the market’s bullish crypto dynamics.

MicroStrategy’s Financial Pulse

In the fast-paced world of trading, the ability to adjust and evolve is key for success. As millionaire penny stock trader and teacher Tim Sykes says, “You must adapt to the market; the market will not adapt to you.” Traders who recognize this truth are better equipped to handle market fluctuations and capitalize on opportunities. By constantly learning and adapting their strategies, they can effectively navigate the challenges and remain competitive in an ever-changing financial landscape.

Examining the latest financial snapshots, MicroStrategy holds nothing back in its bitcoin endeavor. The last quarter didn’t look very vibrant, with revenues sitting at $496.26M. For someone looking in, terms like negative EBIT and an EBIT margin of -163.7% evoke unease with operating income set at a deficit of $478.68M.

Despite soaring numbers like gross margin at a sweet 73.6%, these don’t entirely cover up the dent in the profit margin, standing at -46.03%. Such figures are not for the faint-hearted. However, the company’s robust capital stock of $6.06B and liquid assets of $46.34M hint at MicroStrategy paddling through unpredictable terrains with seasoned experience.

The strategic accumulation of bitcoins points towards a calculated gambit leveraging its balance sheet. They seem to be betting big on the future rise of Bitcoin, using this asset as both a hedge and a growth engine. With Bitcoin touching $100,000, the company’s crypto trove might turn out to be quite the goldmine.

Impact and Interpretations

Crypto Market Surge:

The crypto landscape witnessed a resounding upswing, with Bitcoin and its digital comrades joining a celebratory rally. Significant movements in Bitcoin’s price sent ripples through related stocks, with MicroStrategy reaping these benefits as a major bitcoin holder. This buoyed sentiment aligns with the surge in MSTR’s stock price by 6.2% in pre-market trading.

Cryptocurrency’s unpredictable nature, marked by Bitcoin’s recent drift to a potential all-time high, offers both rewards and risks. Stocks tethered to crypto, like MSTR, inevitably mirror these upheavals—praising its ascent while nervously aware of sudden downturns.

Strategic Partnership with Zebra Technologies:

On the business front, a collaborative venture with Zebra Technologies onto its list of achievements signifies MicroStrategy’s venture into integrating its AI proficiencies more deeply. The partnership aims to enhance workforce optimization through MicroStrategy’s AI-backed business intelligence, readying itself as a forerunner in modern analytics.

Such alliances could broadbase the company’s influence across diverse sectors, leveraging AI to open fresh avenues revenue-wise. Yet, in the volatile world of business data solutions, maintaining relevance over the long haul remains more challenging than ever, demanding ceaseless innovation and customer-focused adjustments.

More Breaking News

Bitcoin Purchase and Market Speculation:

By pouring billions into Bitcoin purchases, MicroStrategy has admirably doubled down on its strategic posture: melding conventional business analytics with blockchain dynamism. The bold move of acquiring additional bitcoins warms up eager speculations about its stock, influencing perceptions of a potentially lucrative payoff as Bitcoin continues its high-velocity ascent.

However, integrating such a substantial cryptocurrency holding isn’t free of peril. MicroStrategy’s fiscal path is intricately interspersed with Bitcoin’s price swings, making its stock sensitive to crypto’s volatile dance. What unfolds next is heavily hinged on the broader crypto market’s unforeseen whims, leaving ardent watchers anticipating future evidences.

Final Thoughts

As the skies tilt with opportunities heavily pregnant on one side and dangers lurking on the other, MicroStrategy continues sailing across the digital frontier. Its partnerships, stock maneuvers, and Bitcoin gambles paint an intriguing picture of a company navigating swiftly changing tides. Like an adept seafarer, it remains on high alert, steering through the unknown while crafting potential wealth from both AI capabilities and blockchain innovation.

The blend of heavy Bitcoin acquisition amid consistent strategic initiatives signals ambitious strides, resonating with its daring trajectory. Yet, in the world of trading, where fierce competition and unpredictability reign, adherence to time-tested wisdom is key. As millionaire penny stock trader and teacher Tim Sykes says, “You must adapt to the market; the market will not adapt to you.” An ever-changing financial seascape demands seasoned vigilance to sustain its equanimous journey. As MSTR ventures ahead with conviction, its path resonates with traders who dare dream alongside, reading between the lines while staying ready for any curveballs that the market might bring.

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”