For years, Strategy commanded a premium well above the value of its bitcoin holdings, giving the company considerable flexibility to raise capital — a lever Michael Saylor and his team used aggressively.

That advantage has now faded. Strategy’s (MSTR) enterprise multiple to net asset value (mNAV) has dropped below 1, signaling a shift in how investors value the firm.

With the stock trading near $82 — about 85% below its November 2024 high — enterprise value has declined to roughly $50.4 billion. Meanwhile, its bitcoin reserves are valued at around $51.1 billion at a $60,000 BTC price. In effect, the market is now pricing the company below the value of its underlying assets, making any new share issuance inherently dilutive.

Enterprise mNAV is derived by dividing enterprise value — including market cap, debt, and preferred equity, minus cash — by the value of bitcoin holdings.

Although Strategy can still issue equity, doing so at current levels could invite further criticism. Its recent bitcoin purchases have already been viewed as dilutive to shareholders, drawing negative reaction from the market.

There is increasing concern that Strategy is being valued more like a closed-end fund than an operating company. Similar vehicles, such as the Grayscale Bitcoin Trust prior to its ETF conversion, often traded at premiums during strong demand but later shifted to persistent discounts as sentiment weakened. These discounts can be difficult to close due to the lack of a redemption mechanism linking share prices to underlying asset value.

However, Strategy retains more flexibility than traditional closed-end funds. It can raise capital through debt or equity when accretive, refinance liabilities, generate cash flow from its software operations, and actively manage its balance sheet.