12 Best Multibagger Stocks to Buy Right Now

5) MicroStrategy Incorporated (NASDAQ:MSTR)

Number of Hedge Fund Holders: 25

One-year Return: ~342%

Average Upside Potential: ~81.5%

Market Cap as of 30^th December: $64.1 billion

MicroStrategy Incorporated (NASDAQ:MSTR) offers AI-powered enterprise analytics software and services.

MicroStrategy Incorporated (NASDAQ:MSTR)’s strategic pivot towards Bitcoin acquisition placed it well in the public markets, providing investors indirect exposure to the world’s largest cryptocurrency. At the core of the company’s current strategy is its aggressive Bitcoin acquisition plan. It has been utilizing a combination of cash from operations, debt issuance, and equity raises to finance its Bitcoin purchases.

MicroStrategy Incorporated (NASDAQ:MSTR)’s Bitcoin strategy provides investors with significant potential upside if Bitcoin prices appreciate. With the company accumulating more Bitcoin, any appreciation in Bitcoin’s value is expected to be magnified in the company’s stock price. The strategy offers a way for investors to provide exposure to Bitcoin via publicly-traded company, which can be more accessible or compliant with certain investment mandates than direct cryptocurrency investments.

If Bitcoin gets wider adoption as a store of value or hedge against inflation, MicroStrategy Incorporated (NASDAQ:MSTR)’s early position can result in substantial returns. In October, the company unveiled its plans to garner $42 billion in fresh capital for Bitcoin purchases over the upcoming 3 years. It holds 252,220 bitcoins as of September 30, 2024. The new capital-raising plan, called the “21/21 Plan,” focuses on securing $21 billion via equity offerings and another $21 billion through fixed-income securities over 2025 and 2027.

While there is optimism around the company’s stock, Artisan Partners, an investment management company, has avoided this company because the firm believes there is a lack of conviction in its franchise characteristics. Here’s what the firm said in its Q2 2024 letter:

“Regarding MicroStrategy Incorporated (NASDAQ:MSTR), our decision to avoid this company comes down to a lack of conviction in its franchise characteristics. The stock has worked this year due to a rebound in the price of bitcoin. Since 2020, MicroStrategy has been focused on converting its cash and cash equivalent holdings, as well as issuing debt, to fund the purchase of bitcoin, which now makes up most of the company’s value.”