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Khing Oei thinks the market is getting STRC badly wrong. The former Goldman Sachs credit investor says MicroStrategy’s preferred stock is mispriced by roughly 13%, and he’s put a number on it: $96.30, against a current trading price of around $85.29.
That’s not a small gap. And Oei’s case for it is pretty specific.
Why the 14% Yield Is Misleading
The headline yield on STRC looks attractive — around 14% — but Oei says that number is basically a trap for investors who don’t read the fine print. The yield calculation assumes perpetual payouts, which ignores a key structural reality: STRC doesn’t mature, and it doesn’t guarantee repayment of its $100 par value. Dividends depend entirely on MicroStrategy’s ability to pay them. There’s no hard floor here.
The stock dropped 25% below par during a Bitcoin selloff in June, which made the yield look even juicier on paper. But that kind of optically high yield can fool people into thinking the downside is already priced in. Oei doesn’t buy that.
His approach is to treat STRC more like a bond — value it on actual cash payouts, not speculative perpetual payments that may or may not materialize. Strip out the fantasy scenario where dividends run forever, and the math looks different.
MicroStrategy holds 843,775 Bitcoin, currently valued at $54 billion, plus $3 billion in cash. But that pool isn’t all available to STRC holders. Around $8 billion is already claimed by debt and senior preferred shares. STRC’s $10.5 billion claim comes after that. Once you work through the stack, $50.2 billion in assets backs the preferred shares, with a yearly dividend requirement of $1.73 billion sitting on top of it all.
The 29-Year Dividend Math
Here’s where Oei’s model gets interesting. He calculates that Bitcoin only needs to grow by 3.4% annually to sustain those dividends indefinitely. Even in a flat Bitcoin scenario — zero appreciation, nothing — the funds would last 29 years. That’s a long runway.
Discount 29 years of payments at 12%, and you get $96.30. The market is paying $85.29, which Oei says implies only 17 years of dividend coverage. He thinks that’s too pessimistic, especially when you look at STRF — a safer MicroStrategy preferred share — which carries a 10.4% yield. The spread between STRC and STRF seems wide relative to the actual risk difference, at least by his math.
Some investors apparently agree. A survey by BitcoinTreasuries found that more than half of STRC holders bought the stock at its dip below par. That’s not panic selling behavior. That’s people betting on value.
Bitcoin’s price is probably the single biggest variable in all of this. Oei’s sensitivity analysis is pretty clear: if Bitcoin hits $80,000, STRC could return to $100. If it drops to $40,000, the stock falls to around $58. The range is wide, and that’s the uncomfortable truth about any instrument this tightly tied to crypto prices.
Conflicts, Skeptics, and Open Questions
Worth flagging: Oei is involved with Treasury, a European Bitcoin treasury firm. If STRC’s mispricing gets recognized and the stock re-rates higher, he likely benefits. That doesn’t make his analysis wrong, but it’s context investors should have.
Skeptics aren’t hard to find. Some market participants see real downside risk for Bitcoin from here, which would obviously pressure the whole thesis. And the core question hasn’t changed — does MicroStrategy’s $57 billion in assets actually provide enough cushion for a $1.73 billion annual dividend obligation? Oei says yes. Others aren’t so sure.
MicroStrategy has shown it’s willing to act on the dividend side. The company raised STRC’s dividend from 9% at its July 2025 listing to 12% now. That move was probably aimed at closing the gap between market price and perceived value. It helped, but not enough to get STRC back to par.
And it’s not just the dividend rate. Additional cash reserves and potential buybacks could also shift the stock’s value, per Oei’s model. Management has levers here. Whether they pull them — and when — is unclear.
The gap between $85.29 and $96.30 is either a market mistake or a reasonable discount for Bitcoin volatility. Oei’s case is detailed and grounded in the actual asset stack. The market’s case is basically: Bitcoin can fall hard, and it has before. Both sides can point to June.
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Frequently Asked Questions
What is MicroStrategy’s STRC stock and how does it work?
STRC is a MicroStrategy preferred stock with a 12% dividend that doesn’t mature and doesn’t guarantee repayment of its $100 par value — dividend payments depend on MicroStrategy’s financial capacity, which is largely tied to its Bitcoin holdings.
How did Khing Oei calculate STRC’s fair value at $96.30?
Oei discounted 29 years of expected dividend payments at a 12% rate, based on MicroStrategy’s $50.2 billion in assets backing preferred shares and a $1.73 billion annual dividend requirement — arriving at $96.30 versus the current market price of $85.29.
