Strategy’s preferred stock, STRC, has seen a notable decline, closing at $91.79, marking its third-lowest close since its launch in July 2025. This value is approximately 8% below its intended $100 par value, reflecting investor concerns regarding dividend coverage and increasing competition.
The stock’s performance has been closely tied to fluctuations in bitcoin prices, which currently hover around $65,000, significantly lower than its peak of nearly $135,000 in October 2021. STRC’s struggles are compounded by worries about the company’s ability to maintain dividend payouts after utilizing part of its cash reserves to address a $1.5 billion convertible debt obligation.
Historically, STRC traded near its par value, particularly leading up to its ex-dividend date. However, since its last ex-dividend date on May 15, the stock has not approached the $100 mark, a departure from past trends where declines typically occurred post-dividend but were followed by recoveries.
In contrast, Strive’s competing product, SATA, has gained traction among investors. SATA offers a higher annual yield of approximately 13% and provides daily dividend payments, contrasting with STRC’s bi-monthly distributions. Additionally, Strive’s debt-free status enhances its appeal, positioning SATA favorably within the capital structure.
The disparity between STRC and SATA has widened, with STRC currently trading at an $8.20 discount to SATA, which is priced at $99.99. This gap represents the largest recorded difference between the two securities.
As of now, STRC’s annualized yield stands at approximately 12.53%, calculated based on its current market price. Analysts suggest that to restore investor confidence and align the stock closer to its intended par value, an increase in the dividend rate by around 100 basis points may be necessary.
Strategy's preferred stock STRC has declined significantly, closing at $91.79 amid concerns over dividend coverage and competition from Strive's SATA. The widening gap between these securities highlights investor shifts towards higher-yield options.