MSTR Stock Rallies with Bitcoin, Turns Massive Paper Loss into Unrealized Profit
Michael Saylor's company, MSTR, has experienced a significant surge in stock price, jumping nearly 40% over the past month from $82 to $140. This increase follows Bitcoin's recovery from the $60,000 range to above $80,650.
MSTR is one of the largest Bitcoin-linked stocks and holds 840,447 BTC at an average cost of $75,385 per Bitcoin. As a result, the company was facing an estimated $9.5 billion paper loss when BTC fell into the low-$60,000 range.
However, with Bitcoin's recent price increase, MSTR's holdings have turned into an estimated $4.2 billion to $4.7 billion unrealized profit. This sensitivity to Bitcoin price moves is due to the size of MSTR's treasury, which makes it highly susceptible to changes in BTC value.
Every $1,000 move in BTC affects MSTR's holdings by roughly $840 million, demonstrating its high correlation with Bitcoin. Additionally, MSTR has also raised $2.01 billion through an ATM program and used part of the funds to buy back 1.43 million STRC preferred shares.