24H|MicroStrategy Stock Jumps Another 5% After Soaring 24% Last Week

Tiger Newspress2024-11-25

MicroStrategy shares gained another 5% in overnight trading.

Shares of MicroStrategy jumped 23.9% higher last week. The Bitcoin investment company was helped by the cryptocurrency's price appreciation last week along with a convertible debt offering at a 0% interest rate. As of the market close on Friday, Nov. 22, MicroStrategy stock is up 567.9% year to date. 

Here's why the stock was rising yet again this week.

Back in 2020, MicroStrategy CEO Michael Saylor made a bold move by taking the company's balance sheet and buying Bitcoin. The bet has paid off handsomely, with the company selling new shares of common stock and taking out debt in order to further accelerate its Bitcoin buys. As of its latest update, MicroStrategy now holds 279,420 Bitcoins.

Last week, the price of Bitcoin went up around 10%, which likely propelled investor optimism with MicroStrategy stock. However, there was another news item that likely caught Wall Street's eyes as well. Last week, MicroStrategy closed on a $3 billion convertible note with a 0% interest rate due in 2029. A convertible note is a debt offering that can be converted into common stock if the stock is above a certain level. MicroStrategy has obtained extremely attractive financing with this debt by paying 0% annual interest and having the debt due in 2029.

Management will now be able to buy more Bitcoin with these funds and will only have to pay back the principal on the debt in 2029 or have it convert to common stock if MicroStrategy stock is above $672.40 per share.

A filing or press release revealing new bitcoin purchases could come in the next few days.

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