MW Circle's stock should be worth less than half what it is now, analyst says

By Steve Gelsi

Mizuho's Dan Dolev set his price target on Circle Internet's stock more than 59% below Monday's closing price, but he's not the most bearish analyst on Wall Street

Circle Internet Group Inc.'s stock is way too high after the initial public offering last month of the USDC stablecoin issuer yielded a nearly 10-fold return at its height, an analyst said Tuesday.

The company went public on June 5 after the IPO priced at $31 a share, and the stock traded as high as $298.99 intraday on June 23. On Monday, the stock $(CRCL.UK)$ closed at $207.46 a share.

Mizuho analyst Dan Dolev initiated coverage of Circle Internet's stock with an underperform rating and a price target of $85, which is 59% below Monday's close. He became the third analyst, of the 15 surveyed by FactSet, who is bearish on the stock.

The shares dropped 1.5% in morning trading, after running up 16.6% over the previous two sessions.

Also read: Circle's $1.1 billion IPO shows Wall Street is taking stablecoins seriously, as crypto company's stock nearly triples

Dolev said Wall Street's current long-term outlook for Circle Internet's revenue is too optimistic. He said Circle's 2027 revenue could be 25% to 30% below the current analyst consensus of $4.5 billion.

"We believe consensus does not fully account for looming interest rate cuts, and also overstates USDC's medium-term growth potential," Dolev wrote in a research note. "We also worry about rising distribution costs."

Since partners such as Coinbase Global Inc. (COIN) retain most of the benefits from Circle Internet's USDC stablecoin distribution, a "healthy" growth for USDC circulation growth would be about 30% from the second quarter of 2025 to the end of 2027," he said.

That means 2027 revenue of $3.3 billion would be "more realistic" than the current estimate of $4.5 billion, Dolev said.

Another concern is that the passage of the advancement of the Guiding and Establishing National Innovation for U.S. Stablecoins Act - Genius Act - which aims to regulate stablecoins, "could be the catalyst that brings competing stablecoins to market," Dolev said.

He noted that PayPal Holdings Inc. (PYPL) already has its own stablecoin (PYUSD), and Amazon.com Inc. $(AMZN.UK)$ and Walmart Inc. $(WMT)$ are exploring issuing their own stablecoins.

So while passage of the Genius Act would be a boon to the stablecoin industry, it also invites more competition by lowering the barriers to entry.

Meanwhile, Dolev is not the most bearish analyst on Circle Internet's stock. That distinction belongs to Kenneth Worthington at J.P. Morgan, which was one of the lead underwriters of Circle's IPO. Worthington's price target on the stock is $80.

Worthington said the stablecoin issuer's stock valuation has been "pushed outside our comfort zone" and recommended investors sell their stock in the company.

Read: Circle Internet's stock price has gotten too high for one of the banks that led its IPO.

Also read: What you need to know about stablecoins and stock tokens as Robinhood and Circle shares jump.

-Steve Gelsi

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July 08, 2025 11:03 ET (15:03 GMT)

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