STRC Stock Price Hits $89 — Here’s What Strategy’s Preferred Shares Are Really Worth Right Now

Right now, STRC has an almost paradoxical quality. On July 2, Strategy’s Variable Rate Perpetual Stretch Preferred Shares Series A, ticker STRC on the Nasdaq, ended the day at $87.46, up more than 3%. This comes after a session in which the stock began trading at $84.99, fell as low as $84.86, and then reached a daily high of $89.25. A preferred share that was issued with a $100 par value is still trading at a discount. However, it is evident that something is happening below the surface when observing the intraday movements.

Here, context is important. In an attempt to finance its ongoing Bitcoin accumulation through preferred stock offerings, Strategy launched STRC in January 2025. Up until it didn’t, it worked. Shares dropped below $74 last week, frightening investors and making it difficult for the company to raise additional funds through STRC issuance without significantly diluting value. A financing tool that is essentially no longer useful is a preferred share that trades significantly below par.

In response, strategy created what management refers to as a “Digital Credit Capital Framework.” In order to bolster a USD reserve that currently stands at about $2.55 billion, the company approved up to $1.25 billion in Bitcoin sales. When taken as a whole, that provides the company with about $3.8 billion in liquidity, or roughly 25.9 months’ worth of coverage for interest and preferred dividend obligations. Additionally, the board approved an additional $1 billion for Class A common stock repurchases, announced buybacks of up to $1 billion in Digital Credit Securities (including STRC shares), and increased STRC’s annual dividend from 11.5% to 12%. There are many moving components, and the market appears to be carefully processing it.

It is noteworthy that the STRC dividend has increased. It is noteworthy, but not without reason, that a 12% annual yield on a preferred share trading in the high $80s implies a running yield closer to 13% or 14%, depending on where you pick it up. This type of yield on variable-rate preferred shares is typically priced in significant credit risk. According to Morningstar, STRC’s overall yield is 13.34%. In addition to drawing in income-focused investors, that figure indicates how the market currently perceives the risk profile of the underlying company.

The most intriguing aspect of all of this is Strategy’s choice to sell Bitcoin, even in small quantities. Relentless accumulation, a type of institutional conviction that no serious Bitcoin holder ever sells, is the foundation upon which Michael Saylor built the entire MSTR narrative. Last month, Chief Executive Phong Le caused a stir when he said, “We are not going to sit back and just say we will never sell the Bitcoin.” That is a significant philosophical change that affects how STRC holders should consider the ideal structure. The Bitcoin backstop is now an active tool in the company’s liquidity management, rather than just a theoretical concept.

Wall Street has been lowering MSTR price targets while maintaining buy ratings: Canaccord dropped from $163 to $130, TD Cowen from $400 to $260, and Citi from $260 to $130. More than any fundamental shift in belief, those cuts are a reflection of Bitcoin’s weakness below $60,000. The most honest way to describe Strategy’s updated plan is probably to say that it buys time, as noted by Peter Christiansen of Citi. The reasoning is different for STRC in particular. While preferred shareholders are more concerned with the company’s ability to continue paying dividends, common shareholders are subject to fluctuations in Bitcoin NAV. The new $3.8 billion liquidity cushion is actually comforting on that more focused question.

Despite its complexity, it is difficult to ignore the fact that STRC is essentially a wager on Strategy’s capacity to manage a highly leveraged Bitcoin position without blowing up its obligations. You can learn everything about the volatility involved from the 52-week range, which is $71.25 low to $100.42 high. As of right now, at $87.46, the market seems to be warming up to the notion that Strategy has purchased enough runway to weather the storm.