Michael Saylor’s Strategy, a publicly traded business intelligence company known for its aggressive Bitcoin acquisition strategy, made notable shifts in its capital allocation last week, heavily favoring the repurchase of its preferred shares over fresh Bitcoin purchases.
Preferred stock buybacks outweigh Bitcoin acquisition
Between Monday and Sunday, Strategy purchased 334 Bitcoin for $28.7 million, according to an 8-K filing submitted to the US Securities and Exchange Commission. This raised the company’s total Bitcoin holdings to 848,000 BTC.
During the same period, Strategy repurchased approximately 1.77 million shares of its STRC preferred stock, investing $176.3 million. This expenditure on preferred stock was more than six times the company’s weekly Bitcoin buying budget.
The significant buyback comes as Strategy looks to strengthen the role of its preferred securities in funding and managing its expanding Bitcoin treasury portfolio. The company’s approach signals a strategic emphasis on preferred shares as a financial underpinning for its cryptocurrency accumulation efforts.
Strategy allocated $176.3 million to buy back 1.77 million shares of its STRC preferred stock in one week, compared to $28.7 million spent on purchasing 334 Bitcoin during the same period.
Michael Saylor, who founded and leads Strategy, has made the company one of the largest corporate holders of Bitcoin worldwide.
Mini dictionary: Preferred stock — A class of ownership in a corporation with a fixed dividend that takes precedence over common stock in the event of asset liquidation, but typically without voting rights.
| Activity | Amount Spent | Asset/Share | Number Acquired |
|---|---|---|---|
| Bitcoin purchase | $28.7 million | BTC | 334 |
| Preferred stock buyback | $176.3 million | STRC shares | 1.77 million |
Shareholder vote on daily dividend payouts
Strategy has also initiated a move to transition dividend payouts on its preferred stocks from the current infrequent schedules to daily payments. The company filed a proxy seeking shareholder approval to pay regular dividends every business day on its STRC, STRF, STRK, and STRD preferred stock listings.
Under the proposal, the dividend rates and total payment obligations would remain unchanged. However, Strategy stated that daily payouts would reduce reinvestment lag and improve both liquidity and price stability for preferred shareholders.
If approved, the new daily payout schedule for STRC would begin in November, while payouts for STRF, STRK, and STRD would shift in January, following a special shareholder meeting set for October 28.
This shift is designed to make preferred stock more attractive to investors seeking more immediate returns and greater flexibility, factors that may support the company’s unique approach to cryptocurrency treasury management.
