TD Cowen Sees 139% Upside for Strategy (MSTR) as Preferred Equity Fuels $2B Bitcoin Buy

The story isn’t the headline price target—it’s the capital stack. TD Cowen raised its 12‑month target on Strategy (MSTR) to $400 per share, a $5 bump from prior forecasts and implying as much as 139% upside. That call landed a day after Strategy disclosed roughly $2 billion of fresh Bitcoin purchases over the past week, underscoring how its funding design keeps compounding BTC exposure per share.

Shares were off about 1.1% at the open Tuesday, trading near $164.79—roughly 64% below the 52‑week peak of $457.22. The target remains below that high, but the path Cowen is underwriting isn’t about rerating software multiples; it’s about sustained balance sheet engineering around Bitcoin.

The engine: preferred equity. Since the last earnings call, Strategy’s treasury activity has leaned almost entirely on its Stretch (STRC) preferred stock, with about $1.95 billion raised versus minimal common issuance. Cowen notes that nearly all proceeds have gone straight into BTC, allowing Strategy to accumulate faster than they previously modeled—already ahead of mid‑quarter purchase forecasts. That cadence delivered nearly 25,000 BTC in the past week alone, about $2 billion at execution, lifting the firm’s holdings to 843,738 BTC—valued around $64.7 billion at the time of writing.

Why this matters: issuing preferreds rather than common shares can keep BTC per share trending higher even as the share count creeps up. Cowen frames the result as accretive—more Bitcoin backing each MSTR share and greater operating flexibility. Bernstein has echoed that the preferred structure is often friendlier to MSTR shareholders than relying on common stock sales.

Strategy also retired roughly $1.5 billion of convertible debt last week. That cleanup, which Cowen called a clear positive for both equity holders and creditors, reduces overhang and widens the firm’s playbook for future issuance windows. Cowen expects Strategy to maintain access to capital markets and to continue prioritizing Bitcoin accumulation; any rebuilding of USD reserves is likely tactical, not a pivot.

Here’s the crux in one lens: the firm is effectively running a programmatic, market‑aware carry trade on its own balance sheet—raising capital via STRC when conditions are favorable, converting it to BTC quickly, and using liability management (like retiring converts) to keep optionality intact. That approach can be psychologically reassuring to a shareholder base that already treats MSTR as a high‑beta BTC vehicle; the per‑share Bitcoin metric becomes the north star, and each financing cycle is judged by its contribution to that number. The model isn’t riskless—access to capital, BTC drawdowns, and issuance costs can all bite—but the repeatability of accretive cycles is what moves targets.

Cowen’s move wasn’t limited to Strategy. Strive Asset Management (ASST), which has mirrored the playbook with a dividend‑paying preferred product, earned a target of $30 per share versus a current price near $15.41—almost 94% potential upside. Strive eliminated its outstanding debt to lean into the preferred strategy and will begin paying daily dividends on SATA preferred shares starting June 16.

What I’m watching next: issuance timing relative to BTC volatility, the pace of STRC uptake, and whether BTC‑per‑share keeps outpacing dilution. If those gears keep turning, the price target debate becomes a question of balance sheet beta, not a narrative about traditional earnings power.