Bitrabo Editorial
By reallocating a significant portion of its cash reserves into Bitcoin (BTC), Semler Scientific Inc., a medical device company based in San Jose, California, has made a daring move that has propelled its stock value upwards.
The firm reportedly acquired 581 Bitcoin for $40 million, fees and expenses included, solidifying its stance among the few public companies opting for Bitcoin as a primary treasury asset, following the lead of MicroStrategy, an enterprise software company.
Semler Scientific Makes Strategic Transition To Bitcoin
According to reports and Eric Semler, the chairman of Semler Scientific, the company’s decision reflects its confidence in Bitcoin as a “reliable store of value” and a “compelling investment.” Semler emphasized:
Bitcoin possesses distinct characteristics as a limited and scarce asset that can act as a viable hedge against inflation and a safe haven amid global uncertainties. Its digital resilience makes it more favorable than gold, which is valued at approximately 10 times the market value of Bitcoin.
This move by Semler Scientific aligns with its goal to optimize its excess cash, amounting to $62.9 million as of March 31, 2024, previously held in bank accounts, Treasury bills, and government money market funds. Semler reiterated:
After evaluating various options, we concluded that investing in Bitcoin would be the optimal use of our surplus cash. While remaining dedicated to our core medical offerings, we believe that this Bitcoin investment strategy can contribute to long-term value creation for our shareholders.
Bitcoin Investment Drives Semler Scientific Stock Surge By 36%
The company’s strategic shift has yielded significant results, with Semler Scientific’s stock price skyrocketing by 36% to $31.61, boosting its market capitalization to approximately $220 million, marking a stark contrast to the stock’s earlier 50% decline this year before the Bitcoin announcement.
Following in the footsteps of MicroStrategy, Semler Scientific has followed suit by concentrating a substantial portion of its treasury into Bitcoin. MicroStrategy’s Bitcoin holdings have exceeded $10 billion, and the company funds these acquisitions using cash flow, equity, and debt sales.
As Semler Scientific continues to generate revenue and free cash flow from its medical offerings, the company intends to assess the utilization of its excess cash regularly, including potential further BTC investments or other strategic ventures.
As of the latest update, BTC is valued at $68,100, experiencing a 2.4% decrease in the past 24 hours.
Featured image from Shutterstock, chart from TradingView.com