TD Cowen Lowers Strategy Price Target to $260, But Calls Its New Capital Framework 'Constructive'

BlockBeats News, June 30th, Wall Street investment bank TD Cowen lowered its Strategy price target from $400 to $260, a decrease of approximately 35%, but maintained a "Buy" rating. The bank evaluated the "Digital Credit Capital Framework" released by the company on Monday as a "progressive positive for credit visibility and capital flexibility."

The analyst explicitly stated that this downgrade was mainly due to an adjustment in the Bitcoin price expectations rather than the framework itself: the bank lowered its year-end 2026 Bitcoin price expectation from around $140,000 to around $100,000 and 2027 year-end expectation from $190,000 to around $135,000. The current $260 target price still implies over 200% upside from Strategy's Monday closing price of $92.68, and the analyst acknowledged that this gap "may seem detached from reality."

Regarding the new framework, Strategy's US dollar reserves have been replenished to $2.55 billion, with the company issuing over 12 million common shares in the past week and not buying any Bitcoin. TD Cowen stated that this move helps restore investors' confidence in the company's ability to withstand a prolonged downturn in Bitcoin prices, with the current reserve coverage exceeding the 17-month low cumulative preferred stock dividend and interest payment requirements, reaching approximately 26 months when factoring in the authorized Bitcoin cash-out limit.

The company was also approved for up to $1 billion in preferred stock buybacks and $1 billion in common stock buybacks. TD Cowen stated that this marks the company's shift from one-way stock issuance to active capital structure optimization; the Bitcoin cash-out ceiling has been set at $1.25 billion, and the proceeds will be used to supplement the US dollar reserves. In addition, the STRC preferred stock dividend rate has been increased from 11.5% to 12%, aiming to stabilize its trading price closer to the $100 face value—the security recently traded at a discount of up to 26% below face value due to a Bitcoin price decline.