Strategy has snapped up nearly 289,000 STRC preferred shares at an average price of $86.52, spending about $25 million. This move marks the first step under its Digital Credit Securities Repurchase Program launched recently. The shares were bought at a notable discount compared to STRC's stated value of $100, a gap that the company sees as an opportunity to reduce future dividend obligations without paying full price.
Between July 20 and July 26, the repurchases took place while Strategy also sold over 5.4 million MSTR shares, raising $544.5 million in net proceeds. Of that, $525 million was added to the company’s U.S. dollar reserve, which now stands at $3.75 billion. Interestingly, Strategy made no Bitcoin trades during this period, even though Bitcoin hovered near $65,000 and MSTR shares surged 7.6% on the Monday following the stock sales.
Balancing Buybacks and Capital Structure
Strategy’s CEO Phong Le highlighted that buying STRC shares below their $100 face value is a savvy capital allocation, as it lowers the company’s dividend burden over time. The repurchase plan remains flexible: up to $975 million is authorized under the program for repurchasing preferred securities, with no minimum purchase limit. Management has indicated buybacks might accelerate if STRC’s market price dips further but would slow once shares reach or exceed the stated $100 value.
This approach also prevents Strategy from issuing new STRC shares below $100, helping maintain market discipline. However, the company remains cautious, recognizing that liquidity constraints, legal factors, and price fluctuations could influence future repurchase activity. The overall goal appears to be steadying STRC’s market value closer to its stated amount while shoring up the firm’s preferred capital structure.
material is informational and not financial advice
