Strategy’s STRC Preferred Drops to Record $80, Cash Runway Shrinks to 14 Months
MSTR•Strategy’s STRC preferred shares dropped to about $80, a record 20% discount from their $100 par value, while annual dividend obligations ballooned from $300 million to $1.2 billion. MSTR common stock fell below $100 since March 2024 as cash reserves shrank, cutting dividend coverage runway to 14 months.
1. Preferred Stock Discount and Dividend Burden
STRC preferred shares traded near $80, a 20% discount from $100 par, as annual dividend obligations surged from about $300 million in January to roughly $1.2 billion, signaling eroding investor confidence and heightened funding costs.
2. Common Stock Decline and Leverage Impact
MSTR common stock dipped below $100 for the first time since March 2024, amplifying dilution risks since selling shares to buy Bitcoin at lower prices demands issuing up to 10 times more shares for the same capital.
3. Cash Runway Pressures and Strategic Options
Cash reserves fell to around $1.4 billion, cutting dividend coverage runway from over seven years to just 14 months, prompting calls to pause Bitcoin purchases and prioritize rebuilding liquidity to sustain preferred dividends.
