TD Cowen Cuts MSTR Target to $260, Keeps Buy on Bitcoin Reset

TD Cowen cut its price target on Strategy stock to $260 from $400 on Tuesday and kept a Buy rating on the shares. The cut came from a lower Bitcoin forecast, not from any rethink of how Strategy runs its treasury.

The bank’s note cutting MSTR’s target to $260 ties the entire reduction to the new Bitcoin path. Through analysts Lance Vitanza and Jonnathan Navarrete, TD Cowen did not move its assumptions for how much Bitcoin Strategy will eventually acquire. It also kept its 3x earnings multiple. The result is implied upside of 198.97% from MSTR’s current share price.

What TD Cowen Actually Changed

The headline move is the price target itself, from $400 to $260 on MSTR. Buy rating stays in place. The reduction came from a single input, Bitcoin’s expected price, not from any rethink of how Strategy runs its preferred-share machine.

TD Cowen now expects Bitcoin to end 2026 near $100,000, down from a prior estimate of about $140,000. Its 2027 forecast also moved lower, to roughly $135,000 from $190,000. Those two revisions, not Strategy’s day-to-day decisions, drove almost all of the cut. The new Bitcoin path is what TD Cowen used to size the MSTR target.

Left untouched were the assumptions that matter most to the bull case. TD Cowen kept its earnings multiple at 3x and held its projections for Strategy’s Bitcoin purchases unchanged. The bank did not punish the company. It marked down the asset the company holds.

TD Cowen applies those two Bitcoin forecasts to a discount of Strategy’s Bitcoin holdings. The earnings multiple of 3x stays unchanged. Together, those inputs produce the new $260 target. The change to the MSTR target traces the new Bitcoin path.

Why a Buy Rating Survived

TD Cowen’s maintained Buy rests on the math. The $260 target implies upside of 198.97% from the current share price.

The bank described Strategy’s Digital Credit Capital Framework as “incrementally constructive,” arguing that the plan codifies how the company will manage liquidity, dividends, repurchases and selective Bitcoin sales through a downturn. TD Cowen added that it had already built most of those dynamics into a May 7 model, so the new framework brought the company’s stated playbook into alignment with what the bank had been pricing in.

TD Cowen acknowledged the implied rebound from Monday’s $92.68 closing price could look out of context.

The note lands on a stock that has already sold off hard. Strategy’s common stock dropped to its lowest level since February 2024, and TD Cowen’s note frames the call as one in which the company is executing, the underlying asset has repriced, and the implied multiple still works at a lower Bitcoin path.

The Capital Framework TD Cowen Just Endorsed

Strategy’s Digital Credit Capital Framework filing on June 29 marked a reset of how the company handles its balance sheet and its preferred-share stack. The framework gives the company three new tools, all designed to keep the funding machine turning without forcing a fire sale of Bitcoin. TD Cowen later called the framework “incrementally constructive,” a characterization that captures the bank read on the company’s intent. Investors read the package as managed flexibility, not as a crisis response.

• Bitcoin monetization program. Strategy can sell up to $1.25 billion of Bitcoin to build or replenish its USD Reserve, the pool used to fund preferred-stock dividends and interest payments. The filing does not cap overall Bitcoin sales, but any sale beyond those authorized purposes requires additional board approval.
• $2 billion in buyback authorizations. The board approved up to $1 billion in repurchases of Digital Credit Securities, which includes STRC, and a separate $1 billion program for MSTR common stock. The programs have no expiration date.
• STRC dividend increase and reserve floor. Strategy raised its STRC preferred dividend to 12% from 11.5% and adopted a formal policy requiring the USD Reserve to cover at least 12 months of preferred dividends and interest obligations.

As of June 28, Strategy said its USD Reserve stood at about $2.55 billion, enough to cover roughly 17.4 months of expected preferred dividends and interest expense. TD Cowen described that reserve build as a step toward restoring investor confidence in the company’s ability to weather an extended downturn.

Strategy rebuilt the reserve after issuing more than 12 million shares of common stock in the week before the announcement while buying zero Bitcoin, a pause from its usual accumulation cadence. Michael Saylor, Strategy’s executive chairman, framed the new framework in capital-management language rather than treasury rhetoric. “Digital Credit requires liquidity, discipline, and active capital management,” Saylor said. “This framework is designed to strengthen credit quality and enable the Company to reduce expected preferred stock dividend payments when accretive.”

The framework does not change Strategy’s primary reserve asset. Bitcoin still sits at the center of the balance sheet, by the company’s own description.

Bitcoin’s Pull and the STRC Discount Behind the Cut

The price target cut is a function of one number: where Bitcoin ends up. Bitcoin has slipped below $59,000, down sharply from the levels analysts were modeling at the start of 2026. With Strategy’s stock functioning as a leveraged Bitcoin proxy on both sides of the move, a lower Bitcoin forecast cascades through MSTR’s market value faster than through almost any other public equity.

The pressure is also visible inside the preferred stack. STRC, Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock, carries an 11.5% dividend and was engineered to trade near $100. It hit a record low in the week before the framework announcement, falling as much as 26% below par. The discount is the market’s live read on whether Strategy can sustain those dividend payments through a sustained Bitcoin drawdown.

CryptoQuant said in a report that Strategy should pause its Bitcoin buying and rebuild its cash reserves, noting that the cushion behind STRC’s dividends has thinned from more than seven years of coverage at the start of 2026 to about 14 months. When STRC trades below $100, Strategy’s engine for issuing shares and buying Bitcoin stalls, which is why the company has paused that part of the operation.

Garlinghouse, Schiff and the Critics Closing In

Ripple CEO Brad Garlinghouse used his June 26 comments on Saylor’s funding model on CNBC’s Squawk on the Street to separate his view of Bitcoin from his view of how Strategy is funding its position. Garlinghouse said he remains bullish on Bitcoin itself. He argued that the leveraged financing structure around the position is what is hurting the broader crypto market. The framing puts Strategy’s financing model in the dock without indicting the asset it finances.

“Financial engineering does not drive long-term value,” Garlinghouse said. “Team Michael Saylor wasn’t focused on the right stuff and that has hurt the overall market.” He pointed to STRC trading about 25% below par as a “damning indictment” of the funding model.

The discount, in his framing, is what a rational market charges when it does not believe the dividend payments will be sustained. The Ripple CEO’s earlier criticism of Saylor’s Bitcoin funding model tracks the same tension.

Economist Peter Schiff added a separate line of attack earlier in the same week, accusing Saylor of making materially misleading statements about Strategy’s digital credit instruments. Schiff’s response was direct: STRC fell 18% in one week and traded as low as 28.75% below par. Strategy has not formally responded to Schiff’s allegation. The criticism lands at the same moment TD Cowen is telling clients that the framework, not the funding critique, is what the bank’s model hinges on, and both can be true at once.

Where MSTR Sits Technically After the Cut

MSTR closed up 12.6% to $92.68 on Monday, the day Strategy unveiled the framework, then dropped 6% on Tuesday as the TD Cowen note and a weaker Bitcoin print pulled the stock back. The stock trades 53% below its 200-day moving average. The October 2025 death cross is still firmly intact.

The Relative Strength Index sits at 29.70, putting MSTR in oversold territory just above its 52-week low of $81.81. Reclaiming the 20-day simple moving average at $112.65 would mark the first technical threshold for any bounce. Below the 52-week low of $81.81, the chart opens fresh downside with no major support. The technical setup has left the stock with no nearby floors.

Canaccord Genuity cut its target on MSTR from $163 to $130 and kept a Buy rating. Mizuho trimmed from $320 to $265 and kept an Outperform. MarketBeat’s consensus now sits at a Moderate Buy with an average price target of $301.57.

Frequently Asked Questions

Why did TD Cowen cut its MSTR price target?

TD Cowen cut its price target on Strategy from $400 to $260 because it lowered its forecast for Bitcoin to about $100,000 by the end of 2026, down from a prior estimate of around $140,000. Its 2027 Bitcoin forecast also fell, to roughly $135,000 from $190,000. TD Cowen left its assumptions for Strategy’s Bitcoin purchases and its 3x earnings multiple unchanged.

Did TD Cowen change its rating on MSTR?

No. The Buy rating on MSTR stayed in place. TD Cowen tied the maintenance to the same lower-Bitcoin math that drove the cut: at $260, the target still implies upside of 198.97% from the current share price.

What is Strategy’s Digital Credit Capital Framework?

The Digital Credit Capital Framework is a board-approved plan unveiled on June 29 that authorizes up to $1.25 billion of Bitcoin sales to build or replenish Strategy’s USD Reserve, up to $1 billion in repurchases of Digital Credit Securities, and up to $1 billion in MSTR common stock buybacks. The plan also set the STRC preferred dividend at 12%, up from 11.5%, and required a reserve floor covering at least 12 months of preferred dividends and interest obligations.

How much Bitcoin can Strategy sell under the new framework?

The framework authorizes up to $1.25 billion in Bitcoin sales to fund the USD Reserve. It does not set an overall cap on Bitcoin monetization, but any sale beyond the listed purposes requires additional board approval.

What is STRC and why does it matter?

STRC is Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock. It carries an 11.5% annual dividend and was engineered to trade near $100 par. The instrument is the preferred stock at the center of Strategy’s Bitcoin funding machine: when STRC trades near par, Strategy can issue more shares to buy more Bitcoin. When STRC trades below par, the issuance engine stalls. STRC recently hit a record low, falling as much as 26% below par.