Buy, Sell, or Hold Strategy Stock? Key Tips Ahead of Q3 Earnings

Strategy MSTR is set to report its third-quarter 2025 results on Oct. 30.

The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $117.1 million, indicating growth of 0.9% from the figure reported in the year-ago quarter. 

The consensus mark for loss is currently pegged at 11 cents per share, unchanged over the past 30 days. The company reported a loss of $1.56 per share in the year-ago quarter.

Consensus Estimate Trend

Strategy reported second-quarter 2025 non-GAAP earnings of $32.52 per share against the year-ago quarter loss of 76 cents per share. On a GAAP basis, earnings of $32.60 per share beat the Zacks Consensus Estimate of a loss of 12 cents per share.
 

Strategy Inc Price and EPS Surprise

Strategy Inc price-eps-surprise | Strategy Inc Quote

Let’s see how things are shaping up prior to this announcement.

Factors to Note for MSTR’s Q3 Earnings

Strategy is the world’s largest bitcoin treasury company, holding 640,250 bitcoins as of Oct. 12, 2025, compared with 628,791 at the end of the second quarter of 2025. MARA Holdings MARA and Riot Platforms RIOT are other well-known companies that hold bitcoins in their respective balance sheets. As of Sept. 30, MARA Holdings and Riot Platforms had 52,850, and 19,287, respectively.

Strategy is expected to have benefited from the Trump administration’s announcement of the establishment of a strategic bitcoin reserve. Bitcoin, the most popular cryptocurrency, has been soaring due to increasing acceptance as a non-sovereign asset, as well as higher institutional and corporate adoption.

Strategy is expected to have benefited from growing software subscription revenues that surged 44% year over year to $48 million and accounted for 41.9% of second-quarter 2025 total revenues. Subscription services soared 69.5% year over year to $40.8 million. The trend is expected to have continued in the to-be-reported quarter.

MSTR Shares Lag Sector, Industry

Strategy shares have returned 2.1% year to date (YTD), underperforming the Zacks Finance sector’s return of 13.6% and the Zacks Financial Miscellaneous Services industry’s appreciation of 2.7%. MSTR shares have underperformed peers, including MARA Holdings, IREN Limited IREN and Riot Platforms, YTD. Shares of IREN Limited, Riot Platforms and MARA Holdings have surged 561.8%, 124.9% and 17.3%, respectively.

MSTR Stock’s Performance

Strategy stock is not so cheap, as the Value Score of F suggests a stretched valuation at this moment.

In terms of price/book, MSTR is trading at 1.77X, higher than MARA Holdings’ 1.51X.

MSTR Overvalued Compared With MARA

MSTR’s Prospects Ride on Growing Bitcoin Holding

Strategy’s disciplined approach to capital raising through preferred equity offerings — Strike (STRK), Strife (STRF), STRD (Stride) and STRC (Stretch) — has been a key catalyst. S&P Global recently assigned a B- issuer credit rating to Strategy with a stable outlook, thanks to the company’s prudent capital management.    

STRK offers an 8% dividend coupon plus MSTR exposure through conversion rights, and has an effective yield of 7.5% as of July 29. STRF offers a 10% cash dividend coupon with enhanced payment protection features and has had an effective yield of 8.7% as of July 29. STRD offers a 10% cash dividend coupon with strong collateral coverage and has an effective yield of 11.9%. STRC offers a variable monthly cash dividend with an effective yield of 9.5% as of July 30. As of Oct. 12, STRK, STRF, STRD and STRC had $20.37 billion, $1.699 billion, $4.15 billion and $4.2 billion, respectively, available for issuance and sale.

Strategy currently expects to achieve a bitcoin yield of 30% and $20 billion in gains, assuming the bitcoin price hits $150,000 at the end of the year. For 2025, Strategy expects operating income of $34 billion, net income of $24 billion and earnings of $80 per share, based on a bitcoin price outlook of $150,000 at the end of the year. 

However, the recent volatility in bitcoin prices makes this target difficult to achieve. Bitcoin is currently trading much lower than $125,338.99, the cryptocurrency hit in early October.

Conclusion

Bitcoin’s inherent volatility, along with Strategy’s stretched valuation, makes the MSTR stock a risky bet ahead of the third quarter of 2025. This, along with the U.S. government shutdown, increases volatility in bitcoin trading, which makes the MSTR stock risky for investors.

Strategy currently has a Zacks Rank #3 (Hold), which implies that investors should wait for a better entry point to accumulate the stock.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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