Strategy Stock Falls to 52-Week Low as Cash Reserves Fund Dividends Only 10 Months
MSTR•MSTR•MSTR•MSTR•Strategy stock hit a 52-week low after losses accelerated to nearly 25% this week as investors questioned its leveraged Bitcoin exposure and dividend sustainability. With $2.21 billion in cash reserves funding preferred dividends for only 10 months, analysts urged pausing Bitcoin purchases and a class-action probe has been launched.
Strategy common shares plunged to a 52-week low, extending a weekly decline to nearly 25% after an 8% drop on June 25 as investor concerns over its leveraged Bitcoin exposure intensified.
The company holds $2.21 billion in cash, enough to fund preferred dividends for just 10 months, and sold 32 BTC in late May to cover payouts, sending its preferred shares down over 23% this month.
A law firm launched a class-action probe into whether Strategy misled investors about its Bitcoin treasury strategy, while analysts recommend pausing further Bitcoin purchases and rebuilding cash reserves to stabilize dividend obligations.
Wsj
