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MicroStrategy (NASDAQ:MSTR) (rebranded as Strategy) just dropped its latest SEC filing, and the big takeaway? No new Bitcoin (BTC-USD) buys between February 24 and March 2, despite the crypto rollercoaster. The company still holds a massive 499,096 bitcoins, scooped up for $33.1 billion at an average of $66,357 per coin. Meanwhile, its stock jumped nearly 12% at 9.46am as Bitcoin rallied, thanks to former President Donald Trump floating plans for a U.S. strategic crypto reserve. But here's the real questionif Bitcoin's price dip wasn't tempting enough for MicroStrategy to add more, is its all-in stance on crypto softening?
On the financial side, MicroStrategy announced a $1.24 per-share dividend on its 8.00% Series A perpetual preferred stock, set for payout on March 31. The company also just raised $2 billion through convertible notes maturing in 2030, with a 35% conversion premium, aimed at institutional investors. Part of the plan? Potentially more Bitcoin buys. At the same time, it's redeeming its 0.0% Convertible Senior Notes due 2027, issuing over 6 million new shares in the process. Translation: MicroStrategy is using every financial tool at its disposal to double down on its long-term Bitcoin strategy, even as its execution raises some eyebrows.
The stock has been on a wild ride, moving at least 15% in either direction for eight straight months, a testament to its deep ties with Bitcoin's volatility. But with increased tax burdens and digital asset impairment risks looming, profitability remains a big question mark. Investors betting on MicroStrategy are essentially betting on Bitcoinmeaning the ride isn't getting any smoother anytime soon. The real test? Whether the company stays aggressive in accumulating Bitcoin or starts pulling back as risks mount.
This article first appeared on GuruFocus.