ST STRC Strategy Inc Variable Rate Series A Perpetual Stretch Preferred Stock Loading... : Bullish and Bearish Analyst Opinions

STRC (Strategy's Series A perpetual preferred stock) will recover to $100 as the company uses proceeds from issuing new STRC shares to buy Bitcoin and the high dividend yield (11-12%) attracts buyers, creating a self-reinforcing cycle. The recent selloff to $75 is an opportunity because the dividend mechanism and market trust in Strategy's Bitcoin strategy will drive price back to par.

Strategy's plan is to get the STRK preferred shares back to par value by building a U.S. dollar reserve, offering buybacks, and demonstrating execution, after which it intends to issue more equity and buy Bitcoin. The recent cash build already lifted STRK from the lows, and the plan provides a clear path back to par.

STRC and STRF are starting to close the gap to par value, which is notable and critical for the company. If they reach par, it would allow Strategy to take a breath and restore confidence. This is a key signal to monitor.

STRC has a hard cap at $100 because Strategy can and will issue shares via the ATM at that price. Shorting STRC at or near $100 creates a highly asymmetric trade: downside is strictly limited (the company runs the ATM at $100 preventing a rally above that level) while upside is effectively unlimited if the stock breaks down. This structural dynamic attracted short sellers and contributed to the recent sell-off, and the setup remains relevant whenever STRC approaches $100.

Strategy's sale of Bitcoin to fund dividends proves they can service preferred obligations, turning the tables on short sellers. The new USD reserve policy, buyback programs, and demonstrated willingness to use Bitcoin as an asset create uncertainty for shorts. If Strategy makes good on its promise to buy back STRC or MSTR common, short positions could face significant losses. Improving the credit rating by showing Bitcoin is a real asset could unlock investment-grade mandates, boosting demand for these securities.

MSTR's new liquidity policy commits to selling ~$1.25B Bitcoin per year to maintain a dollar cushion for preferred dividends, signaling seriousness about dividend payments and making STRC an attractive opportunity; he bought more when STRC fell below $85.

Strategy (MSTR) common and preferred stock (STRC) are rallying, with the mNAV rising to 1.1 and break-even mNAV falling to 1.3, narrowing the gap and suggesting the flywheel is reviving. However, STRC still needs to reclaim above $90 to confirm sustained recovery; the key watch point is when mNAV crosses above break-even mNAV.

The death-spiral narrative around MicroStrategy's Stretch (STRC) is overblown because Bitcoin is scarce and cannot be printed like Luna. Saylor's new digital credit framework, large cash cushion for 18-month dividend coverage, and stated willingness to defend Stretch give confidence that the instrument will survive. He bought STRC below 80 and expects to hold into the high 80s.

Strategy (formerly MicroStrategy) announced a framework that will sell Bitcoin to repurchase preferred shares (STRC) and stabilize share prices. This creates a Luna/Terra-like death spiral risk where selling Bitcoin pressures MSTR's value, which in turn pressures the preferreds, worsening the spiral. In the short term, the mispricing creates a pair trade opportunity: long STRC (preferred) and short MSTR (common), as MSTR is most exposed to the downside from Bitcoin sales.

The speaker describes a 'sailor scheme' involving a complex preferred stack with tickers STRC, STRD, STRK, STRF. None of these preferreds have worked, the issuer keeps releasing new ones, pays bankers huge commissions to raise money, and used ChatGPT for engineering. People are losing faith as they realize the hallucinations created the scheme, implying these preferreds are worthless.

Strategy (formerly MicroStrategy) announced a new Digital Credit Capital Framework, revealing it holds $2.5 billion in USD reserves sufficient to cover STRC preferred dividends for roughly 26 months. This significantly reduces the risk of forced Bitcoin selling to meet obligations and signals that dividend payments are secure. The market reacted by bidding MSTR common shares up 12.6% to $92 and STRC preferred shares up 12%, as fears of a liquidity crunch faded. The framework also includes potential for common stock buybacks and a Bitcoin monetization program, which reinforces shareholder value. The speaker sees room for further short-term upside into the dividend ex-date, although a quick return to the $100 par level may require sustained price support.