MicroStrategy Shares Drop Over 9% as Cash Covers 10-Month Dividend and Legal Probe Looms
MSTR•MicroStrategy shares slid over 9% to a 52-week low after a nearly 25% weekly drop fueled by concerns over its leveraged Bitcoin holdings. The firm has $2.21 billion in cash to cover ten months of preferred dividends and is under a Rosen Law Firm probe into its Bitcoin treasury strategy.
1. Shares Plunge on Bitcoin Exposure
MicroStrategy’s stock slid over 9% on Thursday, extending a weekly decline of nearly 25% and marking a 52-week low as investors grew wary of its leveraged Bitcoin exposure and aggressive accumulation strategy.
2. Dividend Funding Status
The company holds $2.21 billion in cash reserves, sufficient to cover preferred stock dividends for ten months. The sale of 32 BTC in late May to fund dividend obligations contributed to weakening investor confidence, with preferred shares down 23% in June.
3. Rosen Law Firm Probe
A class action investigation examines whether executives made misleading statements about the Bitcoin treasury strategy, profitability, and dividend sustainability. The probe covers multiple securities, with analysts noting that preferred dividends remain discretionary and could require roughly $1.2 billion annually.
