Metaplanet Shares Plummet Despite Massive Share Repurchase Initiative

Metaplanet's stock is facing significant downward pressure this week, with shares declining more than 10% despite the company's announcement of an extensive buyback program valued at 75 billion yen. The current trading price sits at 516 yen, representing a substantial departure from previous peak valuations achieved by the company.

Investors expressed disappointment with the repurchase initiative launched on October 28, which stands as the most ambitious in the company's history. The program authorizes the acquisition of up to 150 million shares, equivalent to 13.13% of its publicly traded float. Funding for this 75 billion yen (approximately $500 million) endeavor will be sourced through a credit facility collateralized by Bitcoin holdings.

Market reaction contradicted typical expectations following such announcements. After briefly climbing to 540 yen, the equity quickly surrendered those gains. At its current level of 516 yen, the stock trades approximately 70% below its annual peak of 1,930 yen. Metaplanet's market capitalization now stands at 588.7 billion yen, with trading volume reaching 38.44 million shares.

Bitcoin Strategy Faces Scrutiny

The Japanese company maintains a substantial cryptocurrency position, holding 30,823 Bitcoin valued at $3.5 billion. This establishes Metaplanet as Asia's largest publicly-traded corporate owner of Bitcoin. The organization has articulated an ambitious target of accumulating 210,000 BTC by the conclusion of 2027.

Should investors sell immediately? Or is it worth buying Metaplanet?

Current market conditions have prompted strategic adjustments. Chief Executive Officer Simon Gerovich explained that the repurchase program represents an optimized capital allocation approach when the company's market valuation falls below its net asset value. This initiative serves as the inaugural significant test of the firm's recently established capital allocation framework.

Technical Indicators and Market Sentiment

From a technical analysis perspective, the Relative Strength Index suggests the stock has entered oversold territory. The sharp descent from yearly highs has established critical support levels around the 500 yen threshold.

Market experts appear cautiously optimistic despite current pressures. The average price target among analysts rests at 1,927.50 yen, with some projections reaching as high as 2,400 yen. Nevertheless, the substantial gap between current trading levels and these targets underscores persistent market skepticism regarding valuation methodologies for companies maintaining significant Bitcoin treasury reserves.