鉴于其稀释性的资本配置和资产出售，MSTR的溢价估值是不合理的；其资本结构已破裂，需要重置。

My favorite company they published new 8K and I just had to talk about how crazy it is that this company continues to trade at a premium and the capital allocation there.

So, I'm going to start off talking about the company I'm obsessed with. The strategy formerly known as MicroStrategy. Disclosure, I'm short a little bit of strategy and long a little bit of the prefs, but I just cannot get over this company and I swear I'm going to land I'm going to stick the landing and I'm going to pull this strategy thing as a whole through for this whole random ramblings.

But, you know, they published an 8-K this morning. Oh, let me see if I can pull up the 8-K while there while I I'm talking, but they published an 8-K and the 8-K says, "Hey, we we sold 300 million of strategy stock." I mean, this is a massive company, so it's not like this is a giant thing, but you know, it's 300 million of stock and we also sold 100 million of Bitcoin and we took the proceeds and we purchased like 80 million of stretch preferreds.

So, what you have in strategy now is you have a company that's trading over nav that is diluting shareholders and selling their Bitcoin in order to buy back prefs at a slight discount on the open market and to park a lot of cash on their balance sheet. And I just you just look at it and you're like, how is this company trading at a premium? Like it it it's just it's so crazy to me. I can't get over it.

But the reason this is going to be a through line is you know, I read their earnings call as someone with a position in them should read their earnings call. And it's crazy how they can talk like it's magic, right? They say, "Hey, look, strategies evolved a year ago, 6 months ago, 2 years ago, when we first started buying Bitcoin. We were a one-way capital issue." And what that means is they were just they only issued stock to buy back Bitcoin to buy Bitcoin. And now they say we're a multi-way capital issue, right? We'll issue stock to buy that preferred at a discount or we'll sell our Bitcoin to buy stock at a discount. And they're saying it like they're some genius and what that I mean all they're talking about is good capital allocation. I mean not even good, like normal capital allocation, right?

Now, the reason this is the through line for this podcast is you know, say what you will about crypto. You can be a crypto bull, a crypto skeptic, whatever it is. I I've generally been pretty skeptical of crypto. But MicroStrategy's underlying observation back in 2020 when they made the Bitcoin pivot was a good one, right? And you can say that on a whole host of different levels. I think Bitcoin was trading at like 20,000 when they made the pivot and it's at 65,000 today. It peaked at like 120,000, right? But a triple inside of I suppose that 6-year, more than a triple inside of 6 years is a very good result, right? A A Now, we're going to ignore that they kind of piled in at the top. So, they're actually underwater on their overall purchases. But if you just take the first thing, uh a triple in 6 years is a very good result. And by the way, they were also right on their theme. Their theme was, "Hey, there equity people who want exposure to crypto in some way, shape or form and they cannot get it." Back in 2020, it's very easy to forget Bitcoin was hard to get right. You get hacked. There were no Bitcoin ETFs, all this sort of stuff. A public company going and doing this and being able to trade them in your brokerage account, like you know, I was skeptical. I said, "Hey, these are financial markets." Like people get But they were they were betting that people wanted a one-click button to buy to buy Bitcoin and they were right, right? So it So they they hit it out of the park with that.

But they never sold. They never traded and they never even considered it until recently, right? Where they've evolved and I think they evolved cuz their capital structure I personally think they completely bungled their capital structure. Uh I think they would have been better off with the kind of holdle forever thing just on the story they're telling. They kind of fall, but now they're selling.

And in the same way that strategy before was mechanical, we sell our stock and buy Bitcoin and we never do anything else.

And you know, again, this strategy thing is crazy and it cracks me up every time this the company's valuation it seems so clear to me that this is a completely busted capital structure that needs to be reset and it needs to be financed. It But just the fact that they said, "Hey, we're going to start thinking about selling. We're going to start thinking about evolving." was hilarious to me. I can't believe they managed to pull it over, but it also, you know, got me thinking about selling.