Already, the market cap of the company is worth less than its Bitcoin. Its market cap was $47 billion today; the Bitcoin held by the company is worth just under $60 billion. That on its own is a perilous position. But if the company’s mNAV (“market-to-net asset value”) falls below 1 then the stock potentially enters a new world of pain. mNAV is a measure of the company’s total market cap plus its debt, minus its cash, divided by its total Bitcoin reserve. If that value is worth less than 1 then the case for owning Strategy stock becomes harder to argue.
Fortune contacted the company for comment.
Strategy fans would argue that might be a time to buy—if the stock was worth less than its Bitcoin then the price per share might rise to meet the price of Bitcoin; it might rise even more if Bitcoin resumed its march higher.
But that, again, would be a sore test for traders who are not true believers. Why hold a stock that is worth less than the underlying asset it represents?
