Strategy Inc (MSTR) Faces Dividend Strain as Bitcoin Holdings Weigh on Stock

Strategy Inc, the Bitcoin treasury company led by Michael Saylor, is under pressure as its preferred dividend stock STRC trades well below its $100 par value and critics question the sustainability of its Bitcoin acquisition model. The company holds 845,256 Bitcoin with a cost basis exceeding $61 billion. Investor concerns about dividend coverage and competition are reshaping sentiment around the stock.

STRC Preferred Stock Slides Below Par Value

Strategy’s dividend-paying preferred stock STRC closed at $91.79 on June 17, trading 8.2% below its $100 par value. The stock offers an 11.5% annual dividend but has struggled to hold near its target price between dividend snapshot dates. STRC has spent most of its trading life below $100 since its July 2025 IPO, with investors accepting downside risk in exchange for above-market yield.

Bitcoin Acquisition Model Under Fire

Economist Peter Schiff, who predicted the 2008 financial crisis, argues that Strategy’s core strategy has become mathematically broken. The model relied on the stock trading at a premium to Bitcoin Net Asset Value, allowing the company to issue new shares and buy more Bitcoin. When shares trade at a discount instead, new issuances dilute existing holders rather than increase Bitcoin per share. Strategy’s cost basis stands at over $61 billion, with an average entry price near $75,700 per Bitcoin.

Recent Bitcoin Sales Trigger Investor Anxiety

Strategy sold 32 Bitcoin in early June to fund structural dividend payments, marking only the second sale since August 2020. The sale sparked concern among crypto investors who feared it signaled larger future liquidations. Days later, the company purchased 1,587 Bitcoin worth approximately $100 million, adding to confusion about its strategy. This volatility in sentiment reflects how negative investor positioning has become.

Analyst Ratings Show Caution

Analyst firms rate Strategy Inc with HOLD ratings and price targets ranging from $517 to $668 USD. The company faces competition from rivals like Strive’s SATA in the Bitcoin-backed securities space. With analyst targets showing limited upside from current levels, the data points to cautious positioning among institutional investors.

Final Thoughts

Strategy’s preferred stock STRC trades 8.2% below par as dividend sustainability questions mount. With analyst HOLD ratings and a fractured Bitcoin acquisition model, the stock faces structural headwinds that limit near-term upside.

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