strategy inc. (NASDAQ:MSTR) shares rose 22% on Friday as TD Cowen maintained its $440 price target, arguing that there is “no reasonable scenario” that would force the company to sell. bitcoin (CRYPTO: BTC) despite trading underwater in its holdings.
TD Cowen Analysts Lance Vitanza and Jonathan Navarrete He said Strategy is “better positioned than ever” to participate in a potential recovery, even as the premise appears strained amid sharp declines. The company’s shares have fallen 13.4% so far in 2026, adding to a 47.5% drop last year.
The volatility appears intentional: Analysts noted that Strategy common stock is designed to be about 1.5 times more volatile than Bitcoin.
“It should be no surprise that Strategy stock outperforms Bitcoin when the price rises and underperforms when it falls. This is, in fact, by design,” they said.
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Regarding solvency concerns, TD Cowen argued that Strategy has “the means to overcome a hypothetically much steeper Bitcoin defeat.”
They pointed to the company’s $2.25 billion cash reserve that could fund $900 million in fixed charges over nearly 17 months while covering $1 billion in marketable convertible notes in 2027.
The first trouble spot appears in March 2028, when additional convertibles mature or become convertible.
Additionally, TD Cowen maintained Bitcoin price targets at $177,000 by December 2026 and $226,000 by December 2027.
TD Cowen’s opinion aligns with recent Strategy executive comments.
On Q4 earnings call revealing $126 billion losses, CEO Phong Le He said Bitcoin would have to fall to around $8,000 and stay there for five to six years before Strategy faces difficulty repaying the convertible debt.
Executive President Michael Taylor He reiterated that the capital structure is designed to withstand prolonged volatility, dismissing threats from quantum computing as “horrible FUD.”
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TD Cowen highlighted Strategy’s emerging “digital credit engine” as a key component of the thesis.
The company raised more than $7 billion in preferred stock in fiscal 2025, representing 33% of all preferred stock sold in the U.S.
The company’s STRC preferred stock pays an annualized dividend rate of 11.25% with daily liquidity in excess of $118 million, providing an alternative financing mechanism beyond convertible debt.
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Strategy shares rose 22% on Friday, rebounding after testing critical support at $100-$110.
However, the stock remains trapped in a descending channel with overhead resistance.
The SAR indicator stands at $155.29 and is above the current prices, indicating that the bearish trend remains intact. Immediate resistance is at $155, followed by $165-175, and then $200+.
Furthermore, the RSI at 36.45 shows a bounce from oversold but remains below 50, confirming that the momentum remains bearish.
Support lies between $100 and $110; If this fails, the next support appears between $75 and $85.
Image source: Shutterstock
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This article ‘No Reasonable Scenario’ Forces Strategy to Sell Bitcoin Targeting $440: TD Cowen originally appeared on Benzinga.com
