Summary
- MSTR has fallen about 38% this year amid bitcoin’s decline, though the shares gained about 5% Monday as Saylor left the door open to future buybacks.
- Strategy plans to maintain larger cash reserves and could sell bitcoin when needed as it works to support STRC and its dividend payments.
- Saylor stated Strategy wants STRC to remain near its $100 issue price, while MSTR investors should have a time horizon of at least four years.
It’s not a priority, stated Executive Chairman Michael Saylor, but Strategy (MSTR) could buy back its own shares if they become cheap enough.
The comments during a Monday Q&A follow a rough stretch for Strategy’s common shareholders. MSTR is down about 38% this year and 73% year-over-year, driven in large part by bitcoin’s BTC$64,374.63 decline, as well as by the consistent issuance of common stock to fund more bitcoin purchases, build cash reserves, pay dividends, and repurchase preferred stock.
“If MSTR is trading at a very, very deep discount to NAV, then probably you would see us do something like that,” Saylor stated.
For now, though, Strategy is focused on its preferred stock business, especially STRC.
CEO Phong Le also defended Strategy’s practice of selling new MSTR shares. While some investors worry that issuing more stock dilutes existing shareholders, Le argued that selling shares can help when MSTR trades above the value of the assets backing each share, and Strategy uses the proceeds to buy bitcoin. In that situation, he stated, the amount of bitcoin backing each MSTR share can rise.
The recent drop in STRC has also changed how Strategy manages its money.
