Microstrategy Inc. is an American software company that provides Business Intelligence (BI) to its global customers. The company offers Microstrategy9, an integrated BI platform that helps business leaders and owners make business decisions. According to surveys, Microstrategy mainly caters to small and medium business enterprises that employ 50-200 employees with average revenue between $1 million and $10 million. The company also offers cloud-based services and mobile software. Some of the largest industry segments served by Microstrategy consist of the computer software industry (20%), Information Technology and Services industry (14%), and retail industry (5%). Eight research firms that are currently covering the market have given a ‘Hold’ rating to Microstrategy stock as of February 10.
What do the recent research reports tell about Microstrategy stock?
Microstrategy Inc. (MTSR: NASDAQ) has focused on several recent research reports. The reports published at the end of October 2021 had raised their price target of the MTSR shares from $780 to $871 and gave it a ‘Buy’ rating. The trend continued till the end of the year as Zacks Investment Research downgraded the stock from ‘Hold’ rating to ‘Sell’ rating on December 30, 2020. As of January 21, 2022, BTIG’s research not only reaffirmed the ‘Buy’ rating but set a price target of $950 on shares of Microstrategy.
Stock Forecasts
Although the research results indicate very high price targets for MTSR stock, at the same time, the stock received a ‘sell’ rating. As of February 14, the Microstrategy stock price was $409.90. The CNN Business analysts that offered a 12-month forecast have set a median target of $540 a while considering a high target of $950 and a low of $425. Based on the figures, the median target is $540, which translates into a 31.87% increase on the current price of $409.90. The analysts maintain a ‘Buy’ rating for MTSR that has remained the same in August 2020.
Company performance
Microstrategy declared its Q4 earnings on January 31, 2022, wherein it reported EPS of $ 8.73 or the quarter, which falls short of $9.92 as per Thomas Reuters’ consensus estimate. The company posted a negative return on equity of 11.29% and a negative net margin of 104.84%. The business revenue during the quarter was $134.52 million against the estimated $133.20 million by the analysts. The revenue was up by 2.4%, and the company posted EPS of $1.87 during the same period in the previous year. According to the prediction of the equities analysts, Microstrategy will like to post an EPS of 6.64 for the current fiscal year.
MTSR price movements in NASDAQ
As per NASDAQ reports available until February 10, the 50-day simple moving average of MicroStrategy pricing was $503.67, and the figure changes to $ 627.14 based on a 200-day simple moving average. The company’s debt-equity ratio is 2.20, a current ratio of 0.86, and a quick ratio of 0.78. The one and low and high recorded by the company’s share price are $307.19 and $1199, respectively. The firm’s market cap is $4.4 billion, a beta of 1.68, and a price-to-earnings ratio of -8.25.
Institutional are showing more interest in the company
The changing positions of the hedge funds and institutional investors show a growing interest in the company.
- During the second quarter, Capital International Investors purchased a new stake in MTSR shares worth $633,429,000.
- Vanguard Group Inc. augmented its shareholding the company by 3.4% for the second quarter and now owns 710,099 shares worth $471,860,000, including 23,263 shares purchased during the quarter.
- Morgan Stanley boosted its Microstrategy shareholding by 11% in the third quarter. The investor now owns 431,687 shares of the company, which translates into $249,689,000. It includes 42,904 shares that the company bought in the last quarter.
- In the second quarter, First Trust Advisors LP increased its shareholding by 57.5% and now owns 261,804 shares worth $173,969,000 including 95, 537 shares of Microstrategy stock purchased in the last quarter.
- State Street Corp boosted its position by buying additional 17,651 shares in the last quarter to push up the total holding to 245,391 shares worth $163,062,000.
Despite the analysts’ rating fluctuations, the average ‘Hold’ rating dominates.
