Sell Rating for Circle Internet Group Amidst Competitive Threat from Hyperliquid’s USDH Launch

Analyst Ed Engel of Compass Point maintained a Sell rating on Circle Internet Group, Inc. Class A, reducing the price target to $96.00.

Ed Engel has given his Sell rating due to a combination of factors impacting Circle Internet Group, Inc. Class A. A significant development is Hyperliquid’s announcement to launch its own stablecoin, USDH, which poses a potential threat to Circle’s financial performance. Hyperliquid’s strategy to incentivize users to convert USDC into USDH by sharing interest income could lead to a substantial shift of funds, negatively affecting Circle’s revenue streams.
Engel anticipates that a majority of Hyperliquid users will transition their holdings from USDC to USDH, resulting in an estimated $100 million reduction in Circle’s gross profit. Consequently, Engel has revised his price target for Circle, reducing it by approximately 28% to $96, reflecting the anticipated financial headwinds and the competitive pressures from Hyperliquid’s new stablecoin initiative.

According to TipRanks, Engel is an analyst with an average return of -3.1% and a 41.86% success rate.