By Jonathan Weil
MicroStrategy hit a new milestone this morning. Its shares were down more than 50% from their all-time, intraday high in November.
In Wall Street lingo, that would qualify as a crash. Led by its charismatic executive chairman, Michael Saylor, the bitcoin-buying machine has been hurt by a decline in the price of the cryptocurrency, which recently fell below $87,000.
And while the stock still trades at a premium to the value of its bitcoin holdings, that gap has shrunk significantly.
(The company recently said it is doing business as Strategy. However, public filings show the official name, as specified in the company's charter, remains MicroStrategy.)
On Nov. 21, when the stock touched $543, the stock market was implying that a bitcoin owned by MicroStrategy was worth more than four times as much as a bitcoin owned by an ordinary person. As of this morning, that multiple has fallen to less than two times. The stock was recently down 11% from Monday's close, at about $250.
MicroStrategy owns about $43 billion of bitcoin, based on this morning's prices, and has more than $9 billion of net debt. Its stock-market value is about $65 billion using the company's recently updated share count.
As long as the stock trades at a premium to its holdings, it still has plenty of room to fall.
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(END) Dow Jones Newswires
February 25, 2025 11:32 ET (16:32 GMT)
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