Investment bank TD Cowen recently adjusted its outlook on Bitcoin treasury company Strategy. They cut the one-year target price from $500 to $440.

The main reason for this downgrade is quite straightforward—Strategy frequently raises funds through issuing common and preferred shares. While this allows them to buy more Bitcoin, it directly dilutes the Bitcoin holdings per share, which is commonly referred to in the industry as the "Bitcoin yield."

Data best illustrates the issue. TD Cowen's analysts expect Strategy to increase its Bitcoin holdings by approximately 155,000 coins in fiscal year 2026, which is more than the previous estimate of 90,000 coins. It sounds good, but the underlying financing logic is a bit awkward—most of the funds used to buy Bitcoin come from equity financing, resulting in a significant dilution effect.

Yield data confirms this. The expected Bitcoin yield for fiscal year 2026 has been lowered to 7.1%, well below the previous estimate of 8.8%, and halving the 22.8% yield in fiscal year 2025.

This recent development is even more noteworthy. During the Bitcoin price correction, Strategy actually accelerated its Bitcoin purchases. In the week of January 11, they issued about 6.8 million common shares and 1.2 million preferred shares, raising a total of $1.25 billion, almost all of which was used to buy 13,627 Bitcoins.

TD Cowen's view is quite rational—such operations have limited yield benefits when financing prices are close to book value. Only when Bitcoin prices rise significantly can the value be realized.

Looking further ahead to 2027, analysts expect Bitcoin yields to recover and grow, but specific figures are still in prediction. Behind this is a continuous balancing act: how to steadily increase Bitcoin exposure without excessively diluting shareholder equity.