Strategy Under Probe While $2.21B Cash Runway Funds Dividends Only 10 Months
MSTR•Strategy shares plunged over 9% to a 52-week low, extending a near-25% weekly decline as investors fretted over its leveraged Bitcoin exposure. The company holds $2.21 billion in cash, enough to cover preferred stock dividends for 10 months, while facing a class action probe into its Bitcoin strategy.
1. Stock Plunge to 52-Week Low
Strategy shares tumbled over 9% to a 52-week low on Thursday, extending a near-25% weekly decline as investors grew wary of its leveraged Bitcoin exposure and the financial burden of its treasury strategy.
2. Cash Reserves and Dividend Runway
The company reported $2.21 billion in cash reserves, stating this provides a ten-month runway to fund twice-monthly preferred stock dividends yielding over 12%, though recent sales of 32 Bitcoin for $2 million have rattled confidence.
3. Rosen Law Firm Investigation
Rosen Law Firm initiated a probe into Strategy and certain executives over potential misleading statements about its operations, Bitcoin treasury strategy, profitability and risk management, covering multiple securities and raising questions about the sustainability of its dividend obligations.
