Shares of Semler Scientific (NASDAQ: SMLR) soared on Tuesday. The medical gadget maker’s inventory peaked at a 43.1% single-day acquire at 2:15 p.m. ET, boosted by a brand new cash-management technique. Extra to the purpose, Semler’s new treasury plan is all about Bitcoin (CRYPTO: BTC) as an alternative of money.
Why Semler Scientific selected Bitcoin over money
In an early-morning press release, Semler stated it regarded over varied treasury methods and settled on a heavy funding in Bitcoin. With $62.8 million of money reserves on the finish of March, the corporate has purchased 581 bitcoins for a complete of $40 million. That is a median price level of roughly $68,850 per Bitcoin, roughly consistent with present market costs.
Administration defined that Bitcoin appears like “a reliable store of value and a compelling investment.” They just like the cryptocurrency’s built-in shortage, making it a protected wager amid global-inflation developments. Chairman Eric Semler additionally gave Bitcoin a positive comparability to bodily gold, whose international market worth is about 10 instances Bitcoin’s.
“Given the gap in value between gold and bitcoin, we believe that bitcoin has the potential to generate outsize returns as it gains increasing acceptance as digital gold,” Semler stated.
He additionally underscored Bitcoin’s rising stature in institutional investing, boosted by the latest approval of spot Bitcoin exchange-traded funds (ETFs).
Juggling crypto investments and the medical gadget enterprise
Elsewhere within the announcement, Semler’s leaders reminded traders that the corporate is all about combating persistent illnesses. Its flagship product, the QuantaFlo blood circulate testing gadget, could quickly develop its medical clearance to incorporate diagnosing cardiovascular illnesses. The Bitcoin concept would not make Semler a cryptocurrency funding — it is solely an effort to guard and perhaps develop Semler’s money reserves in the long term.
However traders see an echo of enterprise software program maker MicroStrategy (NASDAQ: MSTR) right here. The software program enterprise continues to be energetic however largely ignored by market makers, successfully making MicroStrategy a direct play on Bitcoin’s future. Semler is heading down the identical uncharted path.
Solely a handful of corporations personal extra Bitcoin than Semler Scientific, particularly when you exclude crypto specialists comparable to Bitcoin mining specialists. And Semler is a microcap inventory with a market worth of simply $213 million at present — after the Bitcoin-based leap.
In different phrases, Semler Scientific simply grew to become a crypto inventory regardless of administration’s assurance that the primary enterprise stays 100% medical. This inventory will most likely rise and fall alongside Bitcoin’s price strikes from this level on, for higher or worse.
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Anders Bylund has positions in Bitcoin. The Motley Idiot has positions in and recommends Bitcoin and Semler Scientific. The Motley Idiot has a disclosure coverage.
Semler Scientific’s Bitcoin Wager Sends Inventory Hovering 43% was initially revealed by The Motley Idiot