Circle Internet Group, Inc. Class A (CRCL) has received a new Sell rating, initiated by Mizuho Securities analyst, Dan Dolev.
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Dan Dolev has given his Sell rating due to a combination of factors impacting Circle Internet Group, Inc.’s financial outlook. One of the primary reasons is the anticipated 25-30% downside to the consensus revenue projections for the fiscal year 2027. Dolev believes that the current market consensus overestimates the growth potential of USDC and does not adequately factor in the expected interest rate cuts, which could significantly impact revenue growth.
Additionally, rising distribution costs are putting pressure on the company’s net revenue margins, as partners like COIN capture a substantial portion of the USDC economics. Furthermore, the competitive landscape is becoming more challenging with the potential introduction of new stablecoins by major players like PYPL, AMZN, and WMT, which could erode CRCL’s market position. Lastly, CRCL’s valuation appears high compared to its peers, given its reliance on a single macroeconomic factor and the possibility of slower USDC circulation growth, leading to a price target of $85.
Dolev covers the Technology sector, focusing on stocks such as Robinhood Markets, Fiserv, and Block. According to TipRanks, Dolev has an average return of 7.0% and a 55.10% success rate on recommended stocks.
In another report released on June 30, J.P. Morgan also initiated coverage with a Sell rating on the stock with a $80.00 price target.