To The Moon

$MicroStrategy(MSTR)$ is expected to release earnings on 06 Feb 2024 after the market closes (AMC). The consensus EPS Estimate is $0.21 (+101.0% Y/Y) and the consensus Revenue Estimate is $132.18M (-0.3% Y/Y). Technical is showing a bearish crossover, there is a reason because with the recent launch of Spot Bitcoin ETF, MSTR have been the closest crypto stocks to investing into Bitcoin. Bitcoin have not been able to break through $43k, and this could signal that more downside coming. MicroStrategy have a lot of Bitcoin in their holdings, so any fluctuations on the prices of Bitcoin could cause it to go down. MSTR is trying to create an upward trend recently, but it will be difficult as Bitcoin have not been showing much prospect of going above $43k and staying there for a longer period. If we look at how Bitcoin have been trading, we can see that basically it is pretty flat and hovering around $42k, there is not much space for a surge upside. MSTR have also been moving pretty sideway, and with a possible of downside if Bitcoin were to fall below $42k. If we see from the chart for MSTR, when Bitcoin go below $42k, MSTR stock price suffer. Microstrategy (MSTR) Last Reported Earnings MSTR last reported earnings on 01 Nov 2023 after the market close (AMC). MSTR shares gained +6.4% the day following the earnings announcement to close at 454.00. Following its earnings release, 96 days ago, MSTR stock has drifted +8.1% higher. From the time it announced earnings, MSTR traded in a range between 438.74 and 727.77. The last price (490.60) is closer to the lower end of range. Estimated implied straddle for upcoming earnings is 6.2%. We might be seeing a negative price effect, as MSTR would need to offload some of their Bitcoin holdings to fund their operations. Considering that the last quarter, Bitcoin hit new high towards the end of 2023, selling Bitcoin at that time might not be favourable. Microstrategy (MSTR) Post Earnings Movement The options market overestimated MSTR stocks earnings move 75% of the time in the last 12 quarters. The predicted move after earnings announcement was ±8.7% on average vs an average of the actual earnings moves of 4.9% (in absolute terms). This suggest that we could see some volatility for Microstrategy after they announced their earnings, because the implied move is trending higher than average, making it overvalued option. Microstrategy (MSTR) Earnings Implied Volatility Crush MSTR's last earnings implied volatility (IV30) going into earnings was 68.4. The last time MSTR released earnings, the implied volatility dropped to 64.7, resulting in an implied vol crush of 5%. 5 days after earnings, the 30 day IV was 69.0. Average Implied Volatility Crush For MSTR Earnings: 2% Average 30 Day Implied Volatility 1 Day Before Earnings: 86.6 Average MSTR 30 Day IV for the Day of Earnings: 85.3 Average 30 Day Implied Volatility 5 Days After Earnings:99.9 Summary If we looked at how Microstrategy have been trading when Bitcoin hit its low, we can see that MSTR might have too much holdings of Bitcoin. The revenue or earnings from its software business might not be significant. This is one of the stock I will monitor and see how it will perform when Bitcoin is neither high nor low. Appreciate if you could share your thoughts in the comment section whether you think Microstrategy would make revenue gain from its software business and not use Bitcoin to offset its operating expenses. @TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts. Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.