Strategy’s Stock Under Pressure as Key Decisions Loom

Strategy US5949724083

Strategy Inc. enters 2026 facing significant headwinds. The company's shares have fallen dramatically from their previous highs, enduring their longest sustained decline since adopting Bitcoin as its primary treasury asset. Investors are now grappling with whether this represents a typical market correction or a fundamental reassessment of the firm's business model.

A notable shift occurred in the company's communications at the start of the new year. Its January 1st message notably avoided emphasizing Bitcoin or treasury strategy. Instead, the focus returned to the traditional core business. Strategy highlighted its enterprise software and "AI-ready" data platforms, stating that "data strategy has never been more important." The stated goal is to help clients simplify, scale, and better utilize their data. This change in messaging suggests management is attempting to steer market perception back toward its software origins, a likely response to the changed investment landscape since the launch of spot Bitcoin ETFs reduced the stock's appeal as a leveraged proxy for cryptocurrency exposure.

Persistent Underperformance and Decoupling

The stock's performance in the latter half of 2025 broke from historical patterns. According to crypto analyst Chris Millas, the equity posted losses for six consecutive months from July through December. Significant monthly declines included 16.78% in August, 16.36% in October, 34.26% in November, and a further 14.24% in December, with no substantial relief rallies in between.

This behavior contrasts sharply with past corrections, such as during the 2022 bear market, when steep monthly losses were frequently followed by rapid rebounds exceeding 40% within months. The absence of this pattern in 2025 points toward a potential fundamental re-rating rather than a routine pullback.

Furthermore, the share price has decoupled from both Bitcoin and the broader technology sector. Over a twelve-month period, Strategy's stock lost approximately 48%, while Bitcoin declined by only about 10%. The Nasdaq 100, which includes Strategy, actually gained over 20% in 2025, making the stock's weakness particularly pronounced.

A critical metric, the market value-to-Bitcoin-holdings ratio (mNAV), has compressed severely. The company's dashboard shows this ratio now stands at just 0.739 (basic) or 0.967 (Enterprise Value). This indicates the market is assigning no premium to the Bitcoin treasury, a stark change from early 2025 when shares traded at up to 2.5 times the value of the BTC holdings. The stock recently closed at $151.95, roughly 61% below its 52-week high, though slightly above its twelve-month low.

Unwavering Bitcoin Accumulation Amid Strain

Despite equity pressure, management continues its aggressive Bitcoin acquisition strategy. On December 29, 2025, Strategy reported purchasing 1,229 BTC for $108.8 million at an average price of $88,568 per coin. This acquisition was fully financed through the sale of common stock.

The company's total holdings now amount to 672,497 BTC. The cumulative investment since August 2020 is approximately $50.44 billion, resulting in an average cost basis of $74,997 per Bitcoin. Notably, $22.5 billion was deployed for purchases in 2025 alone—nearly half of the total capital invested to date. At current Bitcoin prices, the treasury is valued at around $58.8 billion, tethering the balance sheet more tightly than ever to the cryptocurrency's price while the stock's valuation premium has largely evaporated.

The Burden of Preferred Share Dividends

This aggressive accumulation has been funded substantially through preferred shares and other instruments, creating significant fixed obligations. Annual dividend payments on these preferred shares now total approximately $800 million.

CEO Phong Le has acknowledged that an mNAV below 1.0, combined with constrained capital access, would have consequences. Should the market capitalization remain persistently below the Bitcoin treasury's value and the company be unable to raise new funds, it would consider selling Bitcoin to meet its obligations. This introduces a potential sales option into what was previously a one-sided accumulation strategy, albeit framed strictly as an emergency scenario.

The Impending MSCI Catalyst

A major near-term catalyst arrives in mid-January 2026, when MSCI will decide whether Strategy remains in its global indices. The prediction market Polymarket currently assigns a probability exceeding 75% to the company's removal.

Analysts at JPMorgan warn that an exclusion could trigger substantial forced selling. Index funds that track MSCI benchmarks would likely be compelled to unwind their positions, with potential capital outflows estimated at up to $8 billion. The debate centers on how to classify Strategy. Executive Chairman Michael Saylor argues it remains an operational software provider and thus index-eligible, while its de facto evolution into a major Bitcoin holding complicates categorization for index providers.

Analyst Outlook and 2026 Financing Challenges

Interestingly, many analysts remain optimistic despite the price collapse. Data from TipRanks shows that 12 out of 14 analysts rate the stock a "buy," with an average 12-month price target of $467.75. This implies a theoretical upside of over 200% from current levels. MarketBeat reports similar expectations, with targets ranging from $465 to $485.

The central investment thesis for 2026 revolves around financing capability. Strategy must simultaneously secure fresh capital for further Bitcoin purchases and service the high dividends on its preferred shares. With an mNAV near 1.0 and a share price well below key moving averages, the ability to raise new equity on attractive terms is significantly limited. The company's capacity to balance these tensions will largely determine whether its Bitcoin "flywheel" strategy can continue in its current form.