MicroStrategy Stock Drops 8% After $209M Bitcoin Purchase

MicroStrategy shares fell 5.3% to $302.09 ending the day at $302.96, with after hours trading dropping another 3.19%.

MicroStrategy’s (MSTR) stock took a hit after its latest $209 million Bitcoin purchase, dropping more than 8%. The business intelligence firm, led by Michael Saylor, made the acquisition just before the Nasdaq trading session began on Dec. 30.

The shares fell 5.3% within the first hour, from $318.89 to $302.09, and ended the day at $302.96. After-hours trading saw an additional 3.19% dip, bringing the price down to $293.59.

MicroStrategy’s Bitcoin buying spree, which started on Oct. 31, continued with this purchase, bringing its total BTC holdings to 194,180. To fund the acquisition, the company sold 592,987 shares, raising concerns about its “leveraged” strategy.

This strategy includes using debt and equity to buy more Bitcoin, a move that some critics believe could backfire. Trading resource The Kobeissi Letter pointed out that MicroStrategy could increase its authorized shares by 10 billion, which might lead to dilution and a “lose-lose” scenario.

Despite this, the company’s stock has soared 342.15% since January 2024. MicroStrategy’s heavy focus on Bitcoin, known as “hyperbitcoinization,” has sparked mixed reactions.

While some believe it could lead to massive growth, others fear the company’s aggressive strategy might ultimately collapse. On Dec. 23, MicroStrategy was added to the Nasdaq-100 index, a milestone marking its importance among the largest Nasdaq companies.

With all eyes on MicroStrategy, its bold Bitcoin bet continues to stir both optimism and skepticism in the market.

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