Wall Street analysts are offering intriguing perspectives. The fourth-quarter earnings report from Strategy appears shocking on the surface, but a closer look reveals a completely different story.

Indeed, the figures of a $17.4 billion operating loss and a $12.6 billion net loss are dramatic. However, these are almost entirely non-cash accounting losses associated with the decline in Bitcoin prices. In other words, they are not issues of actual cash flow, but merely book valuation losses.

Mark Palmer of Benchmark makes an interesting point. He states that unless Bitcoin drops to $8,000 and stays there for several years, Strategy will not face a true balance sheet crisis. This is because the company holds approximately 713,500 Bitcoins (worth about $50 billion at current prices), has about $8.2 billion in convertible bonds, and $2.25 billion in cash, giving it a solid capital structure.

Lance Vitanza of TD Cowen shares a similar view. Strategy is intentionally built to amplify Bitcoin volatility, with its common stock trading about 1.5 times Bitcoin’s fluctuations. While this demonstrates leverage’s double-edged nature, considering the company’s $2.25 billion cash reserve and diversified debt maturities, there is no reasonable scenario in the near future to sell Bitcoin.

During Thursday’s earnings release, Bitcoin also came under pressure, and the stock price fell about 17%. But by Friday, the situation changed. As Bitcoin recovered from a low of $60,000 to over $70,000, Strategy’s stock surged 21%.

This is where analysts’ views converge. The key point is not profitability but liquidity. And Strategy’s balance sheet is sufficiently resilient. Both TD Cowen and Benchmark maintain a “buy” rating, viewing Strategy as a leverage exposure vehicle to Bitcoin. Benchmark’s model, which assumes Bitcoin reaching $225,000 by the end of 2026, sets a target stock price of $705.

It’s highly likely that the market has overlooked this context. The focus tends to be on the superficial loss figures, but the actual financial health of the company is quite different.