TLDR
- Strategy (MSTR) bought 2,486 bitcoin for $168.4 million during the week of February 9-16, paying an average of $67,710 per coin.
- Total bitcoin holdings now reach 717,131 coins acquired for $54.52 billion at an average price of $76,027 per bitcoin.
- Current bitcoin price of $68,000 puts Strategy’s holdings at an unrealized loss of approximately $5.7 billion.
- Purchases funded by $90.5 million in common stock sales and $78.4 million in preferred stock sales.
- MSTR shares declined 3.2% in premarket trading and are down over 60% year-over-year.
Strategy added more bitcoin to its balance sheet last week despite mounting losses on its existing position. The company purchased 2,486 bitcoin between February 9 and February 16 for $168.4 million.
The average purchase price came to $67,710 per coin. While that’s slightly below bitcoin’s current $68,000 price, it doesn’t help Strategy’s overall position much.
The company now owns 717,131 bitcoin. The total acquisition cost sits at $54.52 billion, translating to an average of $76,027 per coin.
Simple math reveals the problem. Bitcoin trades around $68,000 today. Strategy paid an average of $76,027. That’s an $8,000 loss per coin, or roughly $5.7 billion in total unrealized losses.
ATM Offerings Fund Bitcoin Strategy
Strategy funded the latest bitcoin purchases through its at-the-market equity program. The company sold $90.5 million worth of Class A common stock during the period.
It also moved 785,354 shares of its 10% Series A Perpetual Strife Preferred Stock. Those sales generated $78.4 million in net proceeds.
The company sold 660,000 common shares total. Strategy maintains capacity for additional preferred and common stock offerings down the road.
Executive chairman Michael Saylor continues executing his bitcoin accumulation plan. The strategy involves selling equity to raise cash, then deploying that cash into bitcoin purchases.
Stock Under Pressure
MSTR shares fell 3.2% in premarket trading after the bitcoin purchase announcement. The stock has faced heavy selling pressure all year.
Year-over-year, MSTR is down more than 60%. The company’s market cap stands at $38.47 billion with average daily volume around 23 million shares.
Wall Street analysts maintain a Buy rating with a $320 price target. But TipRanks’ AI analyst Spark assigns a Neutral rating to the stock.
The bearish case points to negative profitability and cash flow. Technical indicators also flash warning signs, with the stock trading below key moving averages.
Strategy has essentially pivoted from a business intelligence firm into a leveraged bitcoin play. The company raises capital through equity offerings to fund bitcoin purchases.
This approach avoids traditional debt but dilutes existing shareholders. Each new stock sale reduces ownership percentage for current investors.
Strategy discloses bitcoin holdings and purchase activity through its corporate website. The company provides real-time data on stock prices, bitcoin acquisitions, and portfolio metrics.
The February 9-16 purchase marks another week of accumulation for the company. With bitcoin at $68,000 and Strategy’s cost basis at $76,027, the position remains underwater for now.
