Will MicroStrategy’s 10 Billion MSTR Stock Issuance Pay Off in 2025?
The post Will MicroStrategy’s 10 Billion MSTR Stock Issuance Pay Off in 2025? appeared on BitcoinEthereumNews.com.
MicroStrategy witnessed massive growth in 2024 with its heavy Bitcoin acquisition strategy while accumulating 446,400 BTC through a series of convertible notes and debt issuance. The MSTR stock ended the year with 332% gains outperforming Bitcoin’s 118% gains in 2024. As the firm plans to issue a massive 10 billion in equity, market analysts are weighing how it would impact the stock price amid a massive supply surge. MicroStrategy And Its Plans to Issue 10 Billion MSTR Stock As said, MicroStrategy outperformed Bitcoin in 2024 by a margin of 3x, however, the MSTR stock witnessed strong selling pressure throughout December last month. From its all-time high of $473 in November 2024, the company’s stock has corrected 40% so far ending 2024 under $300 levels. This hasn’t stopped the business intelligence firm from buying more Bitcoins. Earlier this week, the company announced its final Bitcoin purchase of 2,138 BTC, worth $209 million, for the year 2024. Now that the company plans for equity dilution from 330 million to 10 billion, analysts are skeptical as to what will happen to the MSTR stock price moving into 2025. To approve this equity dilution, Michael Saylor has proposed a MicroStrategy shareholders vote for the equity dilution. MicroStrategy’s business model revolves around an aggressive Bitcoin acquisition strategy: Borrow at low interest rates: Using 0% convertible notes to raise capital. Buy Bitcoin: Driving its price higher. Sell new shares at a premium: Raising funds to purchase even more Bitcoin. Repeat the cycle. This approach has made Bitcoin integral to MicroStrategy’s operations. However, the proposed share count increase highlights a critical tension. Some critics argue that the move could dilute existing shareholders, reducing their value per share. On the other hand, if the shareholders reject the proposal, the firm would lose its ability to buy Bitcoin on…
Filed under: News - @ January 1, 2025 7:27 am