Is Another Piece of Michael Saylor’s BTC Strategy Starting to Fall Into Place?

Another piece of Strategy (MSTR) Executive Chairman Michael Saylor’s playbook looks to be taking shape after the company’s perpetual preferred share, Stretch (STRC), hit a record high of $100.10 with trading volume reaching 1 million shares.

The milestone is significant because it enables Strategy, the largest holder of bitcoin BTC$102,873.60, to utilize its at-the-market (ATM) offering against STRC to buy more of the largest cryptocurrency. STRC, described by the company as a short-duration, high-yield credit instrument, currently offers an annualized 10.5% return, paid monthly in cash.

The ATM, established on July 31, had been on hold because the instrument was not trading at par. The company raised STRC’s dividend rate, initially at 9%, to help push the trading price toward the $100 par value. According to the latest 8-K filing, the company has $4.2 billion in available capacity for share issuance.

Strategy has already used ATM sales on its other three perpetual preferred products —STRK, STFR and STRD — as well as its common stock to fund bitcoin purchases.

MSTR common shares have fallen 15% this year to around $253. With the multiple to net asset value (mNAV) hovering near 1.3, Saylor’s ability to issue perpetual preferred stock successfully will be key to continuing the company’s bitcoin accumulation in a non-dilutive manner.

STRC is up 0.5% in pre-market trading at $100.50 per share, while MSTR is down 1%.