MicroStrategy (MSTR.US) restarts buying BTC continuously, STRC dividend reform draws attention

According to Woofun AI, MicroStrategy (MSTR.US) (MicroStrategy), led by Michael Saylor, broke the first purchase stagnation since June and resumed the rhythm of continuous weekly Bitcoin purchases. After experiencing a partial sell-off of cryptocurrencies earlier in the quarter and a three-month record of uninterrupted weekly acquisitions, the company is speeding up the rebuilding of its Bitcoin reserves.

This shift marks the departure of MicroStrategy (MSTR.US) from the previous “buy-suspension-occasional sale” fluctuation model to a more determined fund-raising strategy, which aims to reverse the previous negative quarterly position growth trend due to sales behavior and re-establish its position as the largest institutional holder in the market.

In terms of specific position changes, data disclosed by MicroStrategy (MSTR.US) on September 28 shows that in the week ending September 27, the company purchased 1,665 bitcoins at a price of US$142.7 million, with an average acquisition cost of US$85,681. Looking back at the previous week, the company purchased 950 bitcoins for $75.7 million. These two consecutive operations completely ended the three-month empty purchase window.

Notably, the latest round of purchases surged about 75% from the previous week. This increase in intensity directly reversed the negative trend during the quarter. Despite negative growth in cumulative holdings due to sales at the beginning of the quarter, MicroStrategy (MSTR.US) had achieved a net increase of 1,666 bitcoin holdings at the end of the quarter with only 3 trading days left. Bitcoin analyst Mark Harvey pointed out that MicroStrategy (MSTR.US) not only bought back all bitcoins sold during the quarter, but also added additional holdings, which extended its record of achieving net growth in Bitcoin holdings for multiple consecutive quarters to 24 quarters.

According to data compiled by Woofun AI, MicroStrategy (MSTR.US)'s total Bitcoin holdings have reached a record high of 847,666, with a total acquisition cost of about US$63.9 billion and an average purchase price of US$75,437, according to data compiled by Woofun AI. Since this year alone, the company has purchased a total of 175,166 bitcoins. Based on current market capitalization, these bitcoins are worth around $70.7 billion. Compared to total acquisition costs, unrealized gains are approximately $6.75 billion, or 10.6%.

However, judging from financial indicators, up to now, the Bitcoin yield of MicroStrategy (MSTR.US) is only -3.7%, and the net asset value of Bitcoin showed a negative increase of 25,085 units, equivalent to a loss of about 2.1 billion US dollars; during the quarter, the net asset value of Bitcoin was as high as -100,275 units, worth about US$8.37 billion.

In terms of capital operation and financial performance, MSTR.US (MSTR.US) mainly provides financial support for recent Bitcoin purchases through its market-priced common stock issuance plan. Last week, the company sold approximately 1.47 million shares of MSTR shares and received net revenue of $246.2 million, which means there is still $18.84 billion remaining in issuance under the plan. MSTR stock analyst Zayed originally expected MicroStrategy (MSTR.US) to spend between $250 million and $300 million on Bitcoin this week, but the actual spending was only about half of what was expected. Zeid believes that the reduction in spending is due to management's decision to use part of the funds in other areas rather than over-reliance on cash reserves, which are being used to buy back STRC shares. Last week, MicroStrategy (MSTR.US) repurchased approximately 1.53 million shares of its Series A floating interest perpetual preference shares for $151.7 million, which is slightly more than the $142.7 million it spent to buy Bitcoin. The buyback was funded by $103.5 million from the sale of MSTR shares and $48.1 million drawn from US dollar cash reserves.

Additionally, the company used $22.1 million in reserves to pay preferred stock dividends. As of September 27, MicroStrategy (MSTR.US) has approximately $1 billion in general purpose cash and $5 billion in independent dollar reserves. Zayed estimates that STRC stock buybacks last week accounted for about 18.9% of the securities's total trading volume, compared to 22.8% a week ago. He believes that this decline is a moderate improvement, indicating that MicroStrategy (MSTR.US) can support securities prices without putting too much pressure on the market to sell.

This intervention has paid off so well that STRC's stock price has risen to around $99, which is close to its $100 face value. The preferred stock has been struggling to maintain its face value since May, and during the Bitcoin price drop in June, its price even dropped to around $71. Since then, MicroStrategy (MSTR.US) has spent more than $1 billion to repurchase preferred shares through a $2 billion plan to stabilize prices. STRC shares currently pay a 12% dividend each year, and the company increased the frequency of dividend payments from once a month to twice a month in June.

Looking ahead, MicroStrategy (MSTR.US) is proposing further adjustments to the preferred stock structure to increase its appeal to profit-seeking investors. The company has scheduled a special shareholders' meeting on October 28 to seek authorization to implement daily dividend payments for its four preferred shares listed in the US — including STRC, STRF, STRK, and STRD. According to the proposal, STRC will be the first security to implement daily dividend payments and is expected to pay daily dividends to holders registered on November 1 starting November 2. The daily accrual dividend mechanism is designed to shorten the time investors wait for dividends and reinvest while avoiding price fluctuations due to less frequent payments.

MicroStrategy (MSTR.US) made it clear that keeping STRC stock around $100 is one of the core goals of the new architecture. As the quarter comes to an end, the market's focus is on two key indicators: one is whether MicroStrategy (MSTR.US) can continue to buy Bitcoin every week in the third week when it has a large amount of cash and stock issuance capacity; the other is whether STRC's stock price can finally stabilize near face value without the company having to bear huge market selling pressure after several months of support. Subsequent disclosures will verify whether management can achieve dual stability in asset prices and position size through a combination of continuous Bitcoin purchases and repurchases plus daily dividend payments.