Cramer Prefers Bitcoin as Strategy’s Rally Highlights Its Added Obligations
Strategy gained 76% as Bitcoin rallied, but its growing holdings come alongside debt, preferred dividends and new share issuance.
Key takeaways
- Cramer said investors seeking Bitcoin exposure should buy Bitcoin directly.
- Strategy reported total Bitcoin holdings of 847,666 at the end of September.
- The company also reported a $5.02 billion reserve for preferred dividends and debt interest.
- Strategy shares traded at $164.43, up 2.76% from the previous close, as of 20:00 UTC Monday.
Strategy shares rose 76% as Bitcoin rallied, but Jim Cramer said investors seeking Bitcoin exposure should buy the cryptocurrency directly. He made the comments on the October 1 episode of Mad Money while discussing the Nasdaq 100’s third-quarter performance.
As of 20:00 UTC Monday, Strategy shares traded at $164.43, up 2.76% from the previous close.
Strategy reported buying 1,665 Bitcoin for $142.7 million in the week before its September 28 disclosure. That brought its total holdings to 847,666 Bitcoin, acquired for an aggregate $63.95 billion, or $75,437 per Bitcoin including fees and expenses.
The company also reported a $5.02 billion U.S. dollar reserve for preferred-stock dividends and debt interest, plus another $1 billion in cash as of September 27. It repurchased about 1.53 million shares of its STRC preferred stock for $151.7 million during the week.
The company’s Bitcoin exposure comes with financing obligations. Its second-quarter operating loss of about $8.33 billion included about $8.32 billion in unrealized digital-asset losses, while Strategy also issued common shares to help fund Bitcoin purchases and preferred-stock repurchases.
This article was produced with the help of AI technology. Source: Yahoo Finance
