Strategy resumes consecutive weekly Bitcoin buys for first time since June

Strategy bought 1,665 Bitcoin for $142.7 million during the week ended Sept. 27. The company paid an average of $85,681 per Bitcoin. Strategy bought 950 Bitcoin for $75.7 million during the previous week. The latest purchase was about 75% larger than the prior week's purchase. Strategy's two latest purchases left it with a net addition of 1,666 Bitcoin in the third quarter, with three trading days remaining. Bitcoin analyst Mark Harvey said Strategy had repurchased all the Bitcoin it sold during the quarter and added more. Harvey said the purchases extended Strategy's streak of consecutive quarters with net Bitcoin growth to 24. Strategy's holdings reached a record 847,666 Bitcoin. The company acquired those holdings for about $63.9 billion. The average purchase price was $75,437 per Bitcoin. Strategy acquired 175,166 Bitcoin so far this year. The holdings had a current value of about $70.7 billion. They carried an unrealized gain of roughly $6.75 billion, or 10.6%, over Strategy's total purchase cost. Strategy reported a Bitcoin yield of -3.7% year to date. Its negative BTC Gain was 25,085 Bitcoin, equivalent to about -$2.1 billion at the prices used in its reporting. Its quarterly BTC Gain was -100,275 Bitcoin, valued at about -$8.37 billion. Strategy financed the latest purchases through its at-the-market common-stock program. The company sold about 1.47 million MSTR shares last week for $246.2 million in net proceeds. The program had $18.84 billion of issuance capacity remaining. MSTR analyst Zaid had expected Strategy to spend between $250 million and $300 million on Bitcoin during the week. Zaid said the lower purchase reflected management's decision to direct capital elsewhere rather than rely more heavily on the company's cash position. Strategy repurchased about 1.53 million shares of its Variable Rate Series A Perpetual Stretch preferred stock last week. The repurchases cost $151.7 million. Strategy used $103.5 million from MSTR share sales to fund the repurchases. It also used $48.1 million from its USD Cash balance. Strategy separately used $22.1 million from its USD Reserve to meet preferred-stock dividend obligations. As of Sept. 27, Strategy had about $1 billion in general-purpose cash. It had $5 billion in its separate USD Reserve. Zaid estimated that Strategy's STRC repurchases accounted for about 18.9% of the security's total trading volume last week. He estimated the share was 22.8% the previous week. Zaid described the decline as a modest improvement because Strategy needed to absorb a smaller share of market selling to support STRC. STRC climbed to about $99, near its $100 stated value. The security had struggled to hold par since May. It fell as low as about $71 during Bitcoin's June selloff. Strategy has spent more than $1 billion repurchasing preferred shares under a $2 billion program. The company is seeking to stabilize the instrument. STRC pays a 12% annual dividend. Strategy increased its payment frequency from monthly to twice monthly in June. Strategy has proposed another change to make the security more attractive to income investors. The company scheduled an Oct. 28 special shareholder meeting to seek approval for daily dividend payments across its four US-listed preferred securities: STRC, STRF, STRK and STRD. STRC would be the first security to switch under the proposal. Its initial payment on a daily schedule is expected on Nov. 2 for holders of record on Nov. 1. Daily accruals could reduce the time investors wait to receive and reinvest income. Daily accruals could also smooth price distortions that can build around less frequent dividend dates. Strategy has said that keeping STRC near $100 is one objective of the proposed structure. The next disclosures will show whether Strategy extends its Bitcoin buying streak into a third week. They will also show whether repurchases and proposed daily dividends push STRC back to par without requiring Strategy to absorb such a large share of its trading volume.