Circle Internet Group (CRCL) made a splashy debut on the NYSE last month, capturing investors attention. While the market cheered the launch, Wall Street analysts remain divided on the stock’s future. Some see strong potential in Circle’s role in the fast-growing stablecoin market, while others urge caution amid regulatory uncertainties and competition in the crypto space.
Don’t Miss TipRanks’ Half-Year Sale
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
- Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
For context, Circle is a payments company that manages USDC, a stablecoin pegged to the U.S. dollar. The company made its public debut on June 5 at $69 per share against the IPO price of $31. Since then, the stock has soared over 115%, climbing above $180.
Why Some Analysts Are Bullish on Circle Stock
One of the bullish voices on Circle is Bernstein’s five-star-rated analyst Gautam Chhugani, who initiated his coverage on CRCL stock yesterday with a Buy rating. He believes USDC has strong advantages in distribution, liquidity, and regulation that will be hard for others to match. Meanwhile, he believes Circle’s early lead could be key as stablecoins move beyond crypto into payments and banking.
Overall, Chhugani sees CRCL as a must-own stock for investors looking to be part of the next-generation, internet-scale financial system. However, his price target of $230 now implies a modest growth rate of over 25% from the current levels.
Likewise, Citi’s Peter Christiansen believes in Circle’s potential to lead stablecoin adoption as a major driver of its positive outlook. Citi added that while stablecoins improve speed, cost, and transparency, their programmability is the real game-changer, enabling entirely new payment use cases. Apart from this, Citi also classified Circle stock as high risk, pointing to several potential growth drivers in the years ahead. Despite its impressive 117% gain over the past six months, Christiansen warned investors that the stock remains highly volatile.
Additionally, Barclays and Needham initiated coverage yesterday with Buy ratings, reflecting their confidence in the rapid global adoption of stablecoins. Notably, Needham’s top-rated analyst, John Todaro, issued a Street-high price target of $250 for CRCL, suggesting a potential upside of 38%.
CRCL Bears Warn of Volatility and Valuation Risks
On the flip side, J.P. Morgan dampened investor enthusiasm with a Sell rating and a price target of $80, reflecting over 50% downside. The firm warned that Circle is overvalued, citing intensifying competition from tokenized deposits, digital funds, and CBDCs, along with low switching costs. Moreover, regulatory risks could pose a challenge, as new rules may require more capital and potentially slow USDC’s growth.
At the same time, Deutsche Bank’s Brian Bedell began coverage on CRCL with a Hold rating and a $155 price target. While he sees strong long-term potential for stablecoin adoption, he warned that the wide range of possible outcomes could lead to significant volatility in earnings estimates and share price in the near to midterm.
Is Circle a Good Buy?
According to TipRanks, CRCL stock has received a Hold consensus rating, with five Buys, five Holds, and two Sells assigned in the last three months. The average Circle stock price target is $185.73, suggesting a potential upside of 2.5% from the current level.
