Shares of MicroStrategy (NASDAQ:MSTR) are down by 19%, further adding to its five-day decline of about 30%. MSTR stock was hit after it was announced that cryptocurrency exchange FTX was insolvent, bringing down crypto prices across the board. Bitcoin (BTC-USD) is down by over 10% today, bringing its five-day decline to over 20%. Furthermore, the original crypto has plunged below the $17,000 price range for the first time since November 2020.
It’s well known that MicroStrategy owns a massive stake in Bitcoin. At the end of the third quarter, the software company owned about 130,000 Bitcoins that were purchased for about $4 billion. That represents 0.62% of all Bitcoin outstanding. MicroStrategy reported in its Q3 earnings that its impairment charges were only $727,000 compared to $917.8 million during the second quarter and $65 million a year ago, which was attributed to stable Bitcoin prices. However, if the falling prices in the last few days are sustained, the company could record substantial impairment charges for the fourth quarter. On top of that, MicroStrategy noted that its “low-water” mark for Bitcoin is around $17,600.
Meanwhile, CEO Phong Le appears to be unfazed. In the company’s earnings call, he explained:
“To reiterate our strategy, we seek to acquire and hold Bitcoin for the long term. And we do not currently plan to engage in sales of Bitcoin. We have a long-term time horizon and the core business is not impacted by the near-term Bitcoin price fluctuations.”
With Le confident as ever, let’s take a look at five investors betting big on MSTR stock.
5 Investors Betting Big on MSTR Stock
Tracking institutional ownership is important, as these large investors provide liquidity and support for stocks. During Q2, 226 13F filers reported owning MSTR, a decline of 30 filers from the previous quarter. Meanwhile, the institutional put/call ratio sits at 1.89, up from 1.3 during the first quarter. That’s equivalent to 2.68 million calls and 5.08 million puts, implying a bearish options stance. So, who’s still betting big on MicroStrategy?
- Michael Saylor, former CEO: 2.36 million shares. Saylor’s stake is accurate as of Q4 of 2020.
- Capital International Investors: 1.38 million shares. Capital International purchased 1,486 shares during Q2.
- Vanguard: 890,357 shares. Vanguard purchased 2,135 shares during Q2.
- BlackRock (NYSE:BLK): 733,827 shares. BlackRock purchased 56,489 shares during Q2.
- Renaissance Technologies: 399,500 shares. Renaissance purchased 313,200 shares during Q2.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
