Chanos Slams Strategy’s $100 Preferred Shares Stability as Main Stock Plunges Over 60%
Jim Chanos criticized Strategy’s CEO Phong Le and Chairman Michael Saylor for highlighting their perpetual preferred shares trading at $100 par while the stock has lost over 60% in the past year. Strategy’s market valuation is $41.99 billion versus $48.17 billion in Bitcoin holdings, implying a discount to NAV.
1. Chanos Criticizes Preferred Shares
Jim Chanos, a veteran short seller, publicly challenged Strategy’s leadership for celebrating the stability of its perpetual preferred shares at $100 par, questioning why executives would tout junk debt performance when the underlying stock has sharply declined.
2. Stock Performance and NAV Discount
Strategy’s Class A shares have plunged more than 60% over the past year and 16% year-to-date, yet its preferred shares remain at par. The company’s $41.99 billion market valuation contrasts with $48.17 billion in Bitcoin holdings, signaling a share price below net asset value.
3. Company Defense Strategy
CEO Phong Le and Executive Chairman Michael Saylor have defended holding Bitcoin through downturns, pledging not to sell even if prices fall to $8,000 and stating the firm has 2.5 years of cash flow to cover dividends and debt without new capital.