Strategy shares (formerly known as MicroStrategy) rose in trading on Monday after the Bitcoin treasury company expanded its preferred stock repurchase programme to $3 billion from $2 billion, increasing its capacity to buy back outstanding digital credit securities. The company also added more Bitcoins to its treasury.
The stock (MSTR) gained 2.7% to $140.53.
The announcement came alongside the company’s latest Bitcoin purchase, which added 267 BTC to its holdings during the week ended October 18.
Strategy, backed by executive chairman Michael Saylor, said the expanded programme covers its digital credit securities, including STRC, STRF, STRD and STRK.
The company had initially established a $1 billion repurchase programme on June 29 before doubling its size to $2 billion on September 8.
Following the latest expansion, $1.16 billion remained available under the programme.
Strategy expands preferred stock repurchase programme
The larger authorisation gives Strategy additional flexibility to repurchase its outstanding preferred securities.
However, the $3 billion figure represents the programme’s total authorised size rather than a commitment to spend the entire amount.
The company said it had repurchased $193 million of its STRC preferred stock.
STRC is a variable-rate preferred security issued by Strategy.
The programme allows the company to manage its digital credit securities while continuing to pursue its Bitcoin treasury strategy.
Its ability to carry out further repurchases and fund additional Bitcoin acquisitions will depend on available resources and market conditions.
As of October 18, Strategy reported a USD Reserve balance of $4.83 billion and USD Cash of $447.3 million.
Together, the two balances amounted to approximately $5.28 billion in US dollar assets.
The expanded buyback authorisation comes as investors monitor the trading price of STRC and its potential implications for Strategy’s financing plans.
Latest Bitcoin purchase takes holdings to 848,517 BTC
Strategy acquired 267 Bitcoin between October 12 and October 18 for a total purchase price of $22.1 million. The average acquisition price was $82,900 per Bitcoin.
The company funded the purchases by selling 140,872 Class A shares, generating net proceeds of $22 million.
The latest acquisition brought Strategy’s total holdings to 848,517 BTC.
The company said it had purchased the holdings for an aggregate cost of $64.02 billion, representing an average price of $75,446 per Bitcoin.
Bitcoin was trading at $82,175 at the time of writing.
The latest purchase was relatively small compared with Strategy’s overall holdings, while the expanded repurchase programme increases the amount available for potential buybacks of its preferred securities.
STRC price remains in focus after MSCI index rules
The price of STRC is another factor investors are watching as Strategy assesses its financing options.
Matthew Sigel, VanEck’s head of digital assets research, wrote on X that STRC briefly traded at $99.90 last week before falling to $97.72 following MSCI’s finalised rules concerning the removal of MSTR from its indexes.
According to Sigel, preferred-stock indexes have limited representation from MSCI, making STRC’s ability to return to its $100 par value an important level to monitor.
He said trading around par could help Strategy resume larger Bitcoin purchases funded through its at-the-market (ATM) offering.
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