Strategy purchased 1,142 Bitcoin (BTC) for $90 million at $78,815 per coin last week, buying above its $76,056 average cost as the company sits on $5.2 billion in unrealized losses.
The purchase came after Strategy sold 616,715 shares to fund the acquisition, continuing aggressive shareholder dilution that has pushed outstanding shares past 364 million.
The company now holds 714,644 Bitcoin acquired for $54.35 billion, according to a Monday SEC filing. With Bitcoin trading around $69,000, Strategy's holdings show a 9% loss from its average purchase price.
Buying High During Market Crash
Strategy bought the 1,142 Bitcoin between Feb. 2-8 at an average price exceeding its overall cost basis, even as Bitcoin fell from January highs above $100,000 to briefly touch $60,000.
The company's stock dropped 5% at Monday's market open after surging 26% Friday when Bitcoin rebounded from $60,000 to $70,000.
The purchases were funded entirely through equity issuance, with Strategy selling shares for $89.5 million in net proceeds. The company's multiple to net asset value fell to 0.94x in late January, meaning the stock trades at a 6% discount to its Bitcoin backing per share.
Read also: Polymarket Sues Massachusetts As Prediction Market Battle Splits Federal And State Courts
Analysts Slash Targets Amid Massive Losses
Strategy reported an operating loss of $17.4 billion and net loss of $12.4 billion in its latest quarterly results as Bitcoin's price plunge hammered valuations.
The company's diluted share count jumped from 345.6 million in early January to 364.2 million by late January, with Bitcoin per share barely increasing despite massive purchases.
Wall Street analysts cut price targets following the losses. Canaccord Genuity slashed its target from $474 to $185, while Citigroup reduced its forecast from $485 to $325. Mizuho cut from $484 to $403, and TD Cowen lowered from $500 to $440.
Despite the cuts, several firms maintained buy ratings. TD Cowen analyst Lance Vitanza kept a $440 target, while Citigroup maintained $325. The average analyst target of $347 implies 176% upside from current levels near $128, though that depends entirely on Bitcoin's recovery trajectory.
Read next: Roubini Warns Trump Crypto Policies Risk 'Financial Apocalypse'