TD Cowen raised its price target for Strive to $56 from $44 after the bitcoin treasury company bought more BTC in two weeks than analysts projected for the whole fourth quarter. Share dilution has weighed on the stock, but a new $630 million preferred offering could fund more purchases without adding common shares.
TD Cowen analysts raised their price target for Strive (ASST) to $56 from a previous $44 on Friday. Analysts Lance Vitanza and Jonnathan Navarrete noted that the bitcoin treasury company bought more BTC in the past two weeks than they were projecting for the entire fourth quarter.
Strive passes MARA in bitcoin holdings
Strive's holdings climbed to 35,595 BTC, worth roughly $2.9 billion at current prices, from 28,000 at the end of September. That increase of almost 7,600 BTC has already far exceeded TD's previous forecast of 4,750 BTC in purchases for the quarter.
The accumulation included a 3,311 BTC purchase announced Tuesday. Strive then added 2,822 BTC on Wednesday, which gave it the fourth-largest bitcoin holdings among publicly traded companies, just ahead of MARA's reported holdings.
Dilution pressures the shares
However, the growing treasury has come with more shares outstanding, which weighs on ASST shares. The analysts noted that some investors may have sold shares they received from exercising warrants. With no more $27 warrants left, they expect that pressure to ease.
ASST shares fell 6.6% to $23.96 on Friday, though the stock remains up more than 38% year to date.
A $630 million preferred offering
Strive also expanded its SATS preferred share offering to 7 million shares at $90 each, looking to raise $630 million. The offering is expected to close Oct. 20, and the company plans to set aside enough cash to cover 18 months of dividend payments.
TD Cowen expects the offering to help fund even more bitcoin buying without adding more common shares.
Source: The Block
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