Strategy (MSTR) falls after Bitcoin sale even as Mizuho cuts price target

Shares of Strategy (previously known as Microstrategy) MSTR fell more than 6% on Monday after the company disclosed its first strategic Bitcoin sale, marking a notable departure from Executive Chairman Michael Saylor's long-standing commitment to never sell the cryptocurrency.

The decline was compounded by a price target cut from Mizuho and renewed weakness in Bitcoin, which has struggled to regain momentum amid a deteriorating backdrop for digital assets.

According to a filing with the US Securities and Exchange Commission, Strategy sold 32 Bitcoin for approximately $2.5 million at an average price of $77,135 per token.

The transaction reduced the company's holdings from 843,738 Bitcoin to 843,706 Bitcoin.

While modest relative to Strategy's massive Bitcoin treasury, the sale carries symbolic significance as the company's first non-tax-related disposal of the cryptocurrency.

The last time Strategy sold Bitcoin was in December 2022, during a bear market marked by aggressive interest-rate hikes, the collapse of FTX, and widespread contagion across the crypto industry.

Departure from a defining philosophy

For years, Saylor built Strategy's identity around an unwavering commitment to accumulating and holding Bitcoin.

The company transformed itself from a software and consulting business into what many investors view as a leveraged vehicle for Bitcoin exposure.

The latest transaction suggests management is adopting a more flexible approach.

The proceeds from the sale will be used to fund distributions on preferred stock, according to the company.

Industry observers had anticipated the possibility of a sale after blockchain analytics platform Arkham reported that Strategy transferred Bitcoin to Coinbase Prime last week.

Strategy Chief Executive Officer Phong Le had also hinted that such a move could occur.

"We'll likely sell Bitcoin at some point in time, but we will be net increasing our Bitcoin and more importantly, increasing our Bitcoin per share," Le said recently.

His comments echoed remarks made during the company's January earnings call, when he stated that Strategy would sell Bitcoin "when it is advantageous to do so."

Analyst target cut adds pressure

Investor sentiment was further weighed down after Mizuho lowered its price target on Strategy shares to $265 from $320, while maintaining an Outperform rating.

The brokerage reduced its end-of-2027 Bitcoin price forecast to $94,000 from $128,000 following Strategy's first-quarter results, leading to the lower valuation target.

Mizuho noted that the company still maintains approximately $2 billion in reserves intended to fund around two years of preferred stock dividends and highlighted newer financial products such as STRC as sources of flexibility.

Despite the reduced target, analysts continue to expect a return to profitability in 2026, with consensus estimates pointing to earnings of more than $54 per share.

Crypto sentiment weakens

Strategy's sale of BTC also seemed to pull down its price.

Bitcoin fell 1.8% over the previous 24 hours to around $72,127, according to CoinDesk data.

The world's largest cryptocurrency has retreated significantly after climbing above $82,000 earlier this month.

"Momentum is not on Bitcoin's side this week," said Nic Puckrin of Coin Bureau.

"Even though the equities markets continue to be buoyed by strength in AI, that momentum is skipping most of the crypto space," he said.

"This means Bitcoin is being driven more by crypto-specific sentiment, and this is close to rock bottom right now."

Recent geopolitical tensions have added to the pressure.

Bitcoin sold off sharply following US military strikes on Iran, challenging the narrative that cryptocurrencies act as reliable safe-haven assets during periods of market uncertainty.

Investors are also weighing the possibility that prolonged conflict could fuel inflation and keep interest rates elevated, conditions that have historically been less favorable for speculative assets.

Treasury companies rethink strategy

Strategy's sale also reflects a broader shift among some Bitcoin treasury companies.

After months of aggressive accumulation, a handful of firms have begun slowing purchases or selectively reducing holdings to support shareholder-focused initiatives.

Nasdaq-listed ProCap Financial announced on Monday that it sold approximately 52 Bitcoin to fund the repurchase of 2 million shares at what it described as a significant discount to net asset value.

The company said the move increased Bitcoin exposure on a per-share basis for remaining shareholders.

For Strategy, however, the latest transaction is unlikely to alter its standing as the world's largest corporate Bitcoin holder.

As of Sunday, the company still controlled 843,706 Bitcoin acquired at an average purchase price of $75,699.

Yet the sale underscores a growing reality for Bitcoin treasury firms: even the industry's most committed holders may be willing to sell when financial considerations outweigh ideology.