The Tale of MicroStrategy (MSTR): A Bitcoin Odyssey Unveiled by Kerrisdale Capital’s Short Report

MicroStrategy (NASDAQ:MSTR) stock plummets today despite a year-to-date surge of over 150% post the verdict of a short report from Kerrisdale Capital. The hedge fund disclosed its long Bitcoin (BTC-USD) position and short on MSTR.

Kerrisdale argues that MicroStrategy is now an inflated facsimile for Bitcoin, and its traction as a proxy has waned due to the rise of Bitcoin exchange-traded products and funds. The behemoth of Bitcoin held by MicroStrategy, amassed through equities, convertible notes, and debts, has not enriched each MSTR share equivalently. According to Kerrisdale, owning MSTR holds no substantial advantage over merely possessing Bitcoin itself.

MicroStrategy’s equity premium has slipped below 2x for 94% of trading days since 2021. The current premium stands at 2.6x, surpassing its historical norm of 1.3x.

Diving into the MicroStrategy Shareholders Pool

Monitoring institutional investment in MSTR is pivotal, as these titans provide momentum and backing for stocks. Their activities unfurl through quarterly 13F filings, with the latest divulging positions up to Dec. 31.

The buyers during Q4 have hit the jackpot. Recent 13F filings reveal that 349 institutional investors held MicroStrategy stakes, escalating by 22.46% from the previous quarter. Collectively, these investors possess 8.13 million shares, marking a 17.14% increment from Q3.

Let’s zoom in on the top five purchasers:

1. Morgan Stanley (NYSE:MS) procured 299,083 shares, hiking its pool to 602,441 shares.
2. Susquehanna purchased 185,011 shares, elevating its holding to 287,180 shares.
3. BlackRock (NYSE:BLK) snagged 116,704 shares, boosting its total to 1.02 million shares.
4. T. Rowe Price (NASDAQ:TROW) attained 70,696 shares, weighing in with a stash of 77,927 shares.
5. FMR acquired 69,876 shares, enriching its portfolio to 558,914 shares.

At the time of publication, Eddie Pan did not possess any positions in the mentioned securities, either directly or indirectly. The views expressed belong to the author, governed by the InvestorPlace.com Publishing Guidelines.