Matt C
Cybersecurity Engineer, Bitcoin Background Since 2014
Strategy's bitcoin sale, though unpopular, was correct because its shares trade barely at 1x mNAV and below book value, so selling stock would be pure dilution. Per Michael Saylor, it sold 3,588 bitcoin for $216 million to fund preferred dividends, leaving 843,775 bitcoin and $2.55 billion in USD reserves, which are already spoken for by those dividends. The sale is an expensive fix for betting in 2025 that there would be no bear market instead of shoring up future liabilities. x.com x.com x.comÂ
Strategy's accretive Bitcoin accumulation has raised net backing per share, lowering the premium needed to revisit its $543 intraday high. At $98,000 Bitcoin, backing rose from $127 to $160 since November 2024, cutting the required net mNAV from 4.3x to 3.4x. A 2.5x premium at $200,000-$250,000 Bitcoin would imply roughly $896-$1,131; 2.5x is plausible at peak euphoria, not expected at $126,000. Premiums depend on Bitcoin momentum and sentiment, which Strategy cannot control. x.com x.comÂ
Strategy is attracting some of the world's largest fund managers because they want Bitcoin exposure. Their buying supports the bullish case for MSTR as a listed vehicle for institutional Bitcoin demand. x.comÂ
Strategy needs a solid bid to preserve the premium that funds its bitcoin purchases. MSCI's new rules could eject it from global indexes and force passive selling; JPMorgan estimates $2.8 billion in Strategy share sales if that happens, or up to $8.8 billion if others follow. Without the premium, it cannot raise funds to buy bitcoin. Watch whether the rules bite on November 30. x.comÂ
Strategy might be undervalued because it holds far more Bitcoin than the first time its stock traded at the same price. At $140.51 today, it holds 848,517 BTC, versus 193,000 BTC the first time shares reached $140.51. x.com x.comÂ
Strategy offers more upside than bitcoin because it is levered through fixed-dollar convertible debt and preferred equity: if bitcoin reaches $220,000 in 2028-29, it could deliver a much higher percentage return. It should benefit whenever bitcoin flips above $100,000 in the next few years. It can also fall twice as much as bitcoin, so holders must avoid getting stopped out. x.com x.comÂ
The loss of forced ETF buying increases the likelihood Strategy will trade at a discount to the value of its bitcoin holdings. WatcherGuru reports MSCI plans to remove Strategy from its indexes. x.com x.comÂ
Strategy is a buy because bitcoin will rally, with $80K set to crack soon. Strategy now owns more bitcoin than it did in May. x.comÂ
Heavy inflows could lift Strive's mNAV above Strategy's for periods because they have more impact on the smaller company. Strive could do even better than 6x versus Strategy's 4x, as investors seek the faster Bitcoin treasury stock. x.com x.com x.comÂ
Strategy is turning to selling bitcoin to rescue its troubled STRC preferred program, which points toward bankruptcy. It launched a Bitcoin Monetization Program that lets it sell BTC to fund operations, per Watcher.Guru, and the news sent the preferred up 10%, meaning it would sell bitcoin low to support STRC high. x.comÂ
Strategy offers good asymmetry, since it would probably outperform drastically if bitcoin has finally bottomed and moves significantly higher. The stock refuses to go lower despite bearish headlines and a complete lack of faith in management, even though its corporate structure is not the best. x.comÂ