Circle’s (CRCL) market debut was one of the most epic ones this year, soaring from its IPO price of $31 to a blistering $180 in just weeks. But now comes the head-throbbing hangover. JPMorgan (JPM) analysts have initiated coverage on the stablecoin issuer’s stock with a stark warning: it’s overvalued. They’ve slapped an “Underweight” rating on the shares, citing rising competition, regulatory overhangs, and frothy valuations.
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The $80 price target they set for December 2026 implies a sharp 55% drop from where the stock currently trades. “Our target reflects a premium to the IPO price, but a substantial discount to current levels,” analysts led by Kenneth Worthington wrote. JPMorgan sees a 2026 valuation of around $21 billion, which is less than half the company’s current market cap of nearly $44 billion.
Valuation vs. Velocity
CRCL shares have rocketed since listing on the NYSE on June 5. The IPO was priced at a modest $31, valuing the company at $8 billion. But market euphoria around stablecoins, crypto’s resurgence, and Circle’s early-mover status helped it balloon in size—too fast, according to JPMorgan.
They’re modeling the $80 target using a 45x multiple on projected 2027 EPS, plus a $10 “upside premium.” But even that math implies investors are pricing in far more than what Circle is fundamentally set to deliver.
The Biggest Concern Is Competition
JPMorgan’s biggest worry is the competition. Stablecoins may be hot, but they’re not a monopoly game. New competitors like tokenized deposits, digital money funds, and CBDCs could start eating into its lead. With low switching costs, it may only take a few strong challengers to break Circle’s grip.
Regulation Is Another Looming Risk
Another looming risk is U.S. and global regulation. Proposed rules may force stablecoin issuers like Circle to hold substantial equity capital, potentially slowing USDC growth. Meanwhile, international CBDC development, particularly in Europe, could hinder Circle’s global expansion.
Circle may still be a central player in crypto finance, but JPMorgan sees turbulence ahead. With limited pricing power, regulatory risks, and a sky-high valuation, the firm is urging caution.
Is Circle a Good Stock to Buy?
Despite JPMorgan’s bearish $80 target, other Wall Street analysts are still cautiously optimistic about Circle. Based on three recent analyst ratings, Circle holds a Moderate Buy consensus. That includes one Buy, two Holds, and zero Sells.
The average 12-month CRCL price target is $213.33, which implies a potential 18.2% upside from the current share price of $180.43.
