Strategy Inc. Shares Drop 5% After Chanos Slams $100 Preferred Share Focus
Strategy Inc.’s Class A shares plunged over 5% after Jim Chanos slammed CEO Phong Le’s highlight of perpetual preferred shares closing at $100. The stock trades at a 13% discount to its $41.99 billion market valuation versus $48.17 billion in Bitcoin holdings, reflecting wider concerns over its business model.
1. Chanos Criticizes Preferred Shares
Short seller Jim Chanos slammed CEO Phong Le for touting the stability of the perpetual preferred shares at $100, questioning the focus on junk debt while common shares continue to slide.
2. Stock Performance and NAV Discount
The Class A shares plunged over 5% on the session, have lost 16% year to date and more than 60% over the past year, and trade at a 13% discount to net asset value based on $48.17 billion in Bitcoin holdings versus a $41.99 billion market capitalization.
3. Executive Defense and Financial Outlook
Michael Saylor and Phong Le have reiterated their commitment to holding Bitcoin even if it falls to $8,000 and highlighted 2.5 years of cash reserves to cover dividends and debt without raising additional capital.