MicroStrategy’s stock has skyrocketed by over 1,540% since 2020, significantly outperforming the S&P 500, which grew just over 111% during the same period. This remarkable growth has outpaced every company in the index, fueling optimism for continued gains.
MicroStrategy’s Unmatched Performance Since 2020
Since August 2020, MicroStrategy has outperformed all companies in the S&P 500. According to data from blockchain intelligence firm Arkham, the company’s shares have surged far beyond traditional market expectations. Arkham highlighted this in an Oct. 14 post on X (formerly Twitter), stating, “MicroStrategy has outperformed every company in the S&P 500 since August 2020.”
MicroStrategy’s strong performance comes on the heels of rising interest in its leveraged Bitcoin-focused exchange-traded funds (ETFs). These ETFs, aimed at retail investors, recently surpassed $400 million in net assets. This surge underscores the growing demand for Bitcoin exposure through mainstream investment vehicles.
Why MicroStrategy’s Stock is Soaring
MicroStrategy was one of the first public companies to adopt Bitcoin as part of its corporate strategy, holding substantial amounts of the cryptocurrency on its balance sheet. This strategic move, coupled with its leveraged ETFs, has helped the company’s stock reach unprecedented heights.
Crypto analyst Tyler Durden believes this momentum is likely to continue. In an Oct. 16 post, Durden noted that the company could see further gains, sharing a technical analysis chart to support his prediction. His post suggested, “The bigger the grey box, the bigger the bounce,” hinting that MicroStrategy’s stock still has room to grow.
Could MicroStrategy Join the S&P 500?
Despite its impressive stock performance, experts caution that MicroStrategy is unlikely to be added to the S&P 500 anytime soon. According to Seoyoung Kim, an associate professor of finance at Santa Clara University, a company must have positive net income for both the most recent quarter and year to qualify for the index. While MicroStrategy reported a profitable fourth quarter in 2023, it wasn’t enough to offset its overall losses.
Kim noted that MicroStrategy has had difficulty maintaining profitability, saying, “MicroStrategy has consistently seen a negative bottom line, aside from Q4 2023, which was insufficient to bring it to an overall positive net income.”
While a spot in the S&P 500 may remain elusive for now, MicroStrategy’s continued growth and Bitcoin-focused strategy suggest that its stock could see further upside. Investors who are bullish on Bitcoin and the company’s innovative approach will likely keep a close eye on its future performance.
