Why Michael Saylor’s New Stock Strategy is the Financial Equivalent of a Midlife Crisis

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What to know:

  • So, Strategy is about to drop 5 million shares of Strife (STRF) – because why not? Who doesn’t love a good stock name that sounds like a bad video game?
  • This shiny new series boasts a fixed 10% annual cash dividend. That’s right, folks, 2% more than the last time they tried to woo investors. Talk about a glow-up!
  • If they forget to pay you, don’t worry! Your interest will just compound at an extra 1% per year. It’s like a bad relationship that just keeps getting worse. 😅

So, on Tuesday morning, Strategy (MSTR) decided to pull a fast one and raise funds from capital markets to buy more bitcoin (BTC). But, spoiler alert: the Wall Street money fountain is starting to dry up. 💸

According to an SEC filing, the Perpetual Strife Preferred Stock (STRF) offers a fixed 10% annual cash dividend, paid quarterly. If they forget to pay, it compounds at an additional 1% per year (quarterly), up to a maximum of 18%. The first payment? Not until June 30, 2025. So, mark your calendars, folks! 🗓️

Now, let’s talk about the initial preferred series (STRK) that only offered an 8% interest rate. I mean, come on, that’s like offering a free sample of stale bread. And their convertible debt offerings? Negligible or even 0% interest rates. It’s like they’re trying to win the “Most Generous Company” award by giving away nothing!

Unlike common stock, STRF holders don’t get to vote. But hey, at least they have priority in liquidation with a $100 per share liquidation preference. So, if things go south, you’ll be the first to know! 🎉

STRF is expected to hit Nasdaq within 30 days of issuance, giving investors a chance to dip their toes into bitcoin with a high-yield structure. Morgan Stanley, Barclays, Citigroup, and Moelis & Company are the joint book-running managers for this little adventure, conducted under an SEC shelf registration. Sounds fancy, right?

After buying bitcoin like it was going out of style, Strategy’s fundraising and token acquisitions have slowed to a crawl. Last week, they bought a whopping 130 BTC for $10.7 million. I mean, who needs a needle-moving purchase when you can just buy a few tokens and call it a day? 🙄

MSTR is down 5% in early action Tuesday, right alongside a general market slide and bitcoin’s dip to $81,300 from $84,000 a day ago. So, if you’re feeling a bit queasy, you’re not alone!

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2025-03-18 17:29