TD Cowen analysts say Strategy’s stock could face continued pressure due to an impending MSCI review.
The firm expects that PBTCs like Strategy will be removed from all MSCI indexes this February. A formal decision is expected around mid-January.
Cowen called the potential removal “capricious” but emphasized that investors should prepare for sustained selling pressure. The analysts note that Strategy is not a fund, trust, or holding company. Instead, it is a public operating company. Its $500 million software business generates all of its revenue.
Meanwhile, its Bitcoin treasury operations are innovative and active, offering unique Bitcoin-backed securities.
“Removing Strategy from broad indexes simply because of its Bitcoin focus feels arbitrary,” the analysts wrote. Cowen questioned whether MSCI’s rationale reflects a bias against crypto rather than any strict classification criteria. MSCI has cited concerns that PBTCs may resemble investment funds, which are ineligible for index inclusion.
Cowen counters that Strategy’s structure is clearly different.
Strategy and MSCI exclusion
The stakes are high. JPMorgan recently warned that excluding Strategy from MSCI could trigger $2.8 billion in passive outflows. If other indexes follow, the total could reach $8.8 billion. Strategy’s market cap currently sits near $59 billion, with roughly $9 billion held in passive index-tracking vehicles.
Any forced selling could exacerbate an already depressed share price, JPMorgan argued.
Strategy’s shares have fallen more than Bitcoin in recent months. The company’s mNAV — the ratio of market value to Bitcoin holdings — has dropped to just above 1.1, its lowest since the pandemic. Investors have seen the stock decline over 60% since last November. Its preferred shares and bond issuances have also sold off sharply.
Despite the volatility, Cowen recently long-maintained a bullish long-term outlook. The bank estimated thatthe company could hold 815,000 BTC by 2027. At that level, intrinsic Bitcoin value per share could support a price target of $585, implying roughly 170% upside from current levels.
Cowen attributes the recent weakness to market volatility and index-related fears, rather than a failure of Strategy’s core accumulation model.
Michael Saylor, Strategy’s chairman, dismissed index concerns. In a recent statement, he emphasized that the company is a fully operating business with active software and Bitcoin-backed credit programs. Saylor has repeatedly highlighted its innovative financial products, including structured Bitcoin credit instruments like $STRK and $STRC, which offer yields above traditional credit markets.
Saylor envisions accumulating $1 trillion in Bitcoin and growing the company 20–30% annually, leveraging long-term appreciation to create a massive store of digital collateral.
From this base, Saylor plans to issue Bitcoin-backed credit at yields significantly higher than traditional fiat systems, potentially 2–4% above corporate or sovereign debt, offering safer, over-collateralized alternatives.
Saylor believes that other large scale traditional finance companies can follow the Strategy model with their income.
Cowen also points to potential tailwinds. A possible inclusion in the S&P 500 could broaden institutional ownership and stabilize flows into the stock. Additional regulatory clarity around Bitcoin could further bolster investor confidence.
Strategy’s rise underscores the growing role of Bitcoin in global finance. Its inclusion in indexes like the Nasdaq 100 and MSCI benchmarks has historically funneled crypto exposure into mainstream portfolios.
If MSCI excludes the company, Cowen argues, the market may see short-term disruption but long-term adoption trends remain intact.
Bitcoin itself has struggled over the past month, dropping from an October high above $126,000 to around $88,000 recently. Even amid this sell-off, Strategy continues to execute large Bitcoin purchases, now holding more than 3% of total supply.
Bitcoin bulls need to keep the price above $84,000 after last week’s close. If it falls, weak support sits near $75,000, with stronger buying likely in the $72,000–$69,000 zone. A deeper drop targets the “$58k gang” area around the 0.618 Fibonacci level at $57,700.
MSTR is up over 4% today trading at $177.47.
