Latest news with #USDcoin
Yahoo
01-07-2025
- Business
- Yahoo
Circle (CRCL) Shares Could Crash 54% After Soaring Post-IPO
July 1 - Goldman Sachs has given Circle Internet (NYSE:CRCL) a "Hold" rating with a $83 price target, implying more than 54% downside from current levels. Analyst James Yaro notes that Circle's 484% share price surge since its IPO has pushed its valuation to an elevated level. He believes the company's growth prospects remain intact but prefers to stay on the sidelines until the stock aligns more closely with fundamentals. Warning! GuruFocus has detected 4 Warning Signs with NVDA. Circle is seeking to strengthen its U.S. dollarpegged stablecoin infrastructure by applying to the Office of the Comptroller of the Currency (OCC) for a national trust bank charter. If approved, this would allow Circle to custody its own reserves and hold crypto assets on behalf of institutional clients. As the sole issuer of USD Coin, the world's second?largest stablecoin, Circle may benefit from broader stablecoin adoption and regulatory clarity. The firm is also forging partnerships in programmable payment interfaces and on?chain treasury solutions, moves that could bolster its fee?based revenue. Despite these initiatives, Goldman Sachs sees limited near?term upside for the stock. A clearer regulatory framework and stronger valuation alignment may be needed before investors return in force. This article first appeared on GuruFocus.
CTV News
30-06-2025
- Business
- CTV News
Wall Street analysts bullish on Circle after blockbuster IPO, but warn on sky-high valuation
Traders work on the floor at the New York Stock Exchange in New York, Monday, April 7, 2025. (AP Photo/Seth Wenig) Wall Street brokerages began coverage of stablecoin issuer Circle Internet Group on Monday with broadly bullish ratings, though some analysts voiced concerns about its elevated valuation after the stock more than doubled since its market debut. The New York-based company's shares were down nearly three per cent in premarket trading. Circle debuted this month at US$69 per share in the first major IPO by a stablecoin issuer. The blockbuster flotation represents the biggest crypto listing since Coinbase's 2021 debut. The company had priced its IPO at $31 per share. J.P. Morgan, Citigroup and Goldman Sachs were the lead underwriters for the offering. After the industry-mandated quiet period expired, Barclays, Bernstein, Canaccord Genuity and Needham launched coverage with the equivalent of 'buy' ratings and price targets above $200. 'CRCL is building a market-leading digital dollar stablecoin network, with a strong regulatory edge, liquidity headstart and marquee distribution partnerships. This is hard to replicate, in our view,' Bernstein analysts said in a note. Circle is a blockchain infrastructure company best known for issuing USD Coin (USDC), a fully reserved, U.S. dollar-backed stablecoin used across crypto trading, payments, and decentralized finance. In June, the U.S. Senate passed the GENIUS Act with bipartisan support, marking a watershed moment for the digital asset industry by establishing the first federal regulatory framework for stablecoins. 'CRCL is one of the only ways for public investors to play the blockchain infrastructure theme, and we believe stablecoins are nearing a pivotal turning point,' Barclays said. However, J.P. Morgan and Goldman Sachs pointed to the stock's elevated valuation, given its rapid rise since the IPO. J.P. Morgan started coverage with the most bearish view on Wall Street - an 'underweight' rating with a price target of $80, implying a downside of 56% from the stock's last close of $180.43. 'We view CRCL's business and growth attractively, but valuation appears elevated,' said Goldman, as the brokerage started coverage with 'neutral' and $83 price target. Shares of Circle have surged 161 per cent since their market debut. (Reporting by Rashika Singh and Siddarth S in Bengaluru; Editing by Tasim Zahid)
Forbes
23-06-2025
- Business
- Forbes
Circle Stock At 60% Safety?
An illustration shows the USD Coin logo displayed on a smartphone in Suqian, China, on March 13, ... More 2025. (Photo Illustration by Costfoto/NurPhoto via Getty Images) Circle Internet Group (NYSE:CRCL) has been one of the most exciting fintech IPOs in recent months. Since its debut at $31 per share in early June, the stock has surged to current levels of almost $240 - an 8x gain. Missed the surge? Don't worry. There's still a smart way to potentially profit from Circle's long-term growth, with a built-in margin of safety and returns far better than cash or bonds. With crypto back in vogue and much-anticipated stablecoin regulation bill clearing the Senate, investors may be pricing in too much, too soon. But what if you could get in at a 60% plus discount - say, around $100 a share? Now we're talking. If that price sounds like a bargain and you've got some dry powder, here's a clever trade to consider. The Trade: 20% yield at 60% margin of safety, by selling Put Options CIRC stock is trading at about $240. You can sell a long-dated Put option expiring June 18, 2026, about a year away, with a strike price of $100, and collect roughly $1,965 in premium per contract (each contract represents 100 shares). That's a 19.65% yield on the $10,000 you're setting aside for the possibility of buying the stock in just 12 months. Plus, don't forget, this cash parked in a savings or money market account will earn an extra 4% per annum. So we're talking about an overall yield close to 24%. Separately, see Is COIN Stock A Buy As Stablecoin Bill Clears The Senate? And here's the kicker. You're agreeing to buy Circle stock at $100, a roughly 60% discount to the current market price, only if the stock drops below that level by the expiration date. The strategy is reliable because large institutions have tested the strategy at scale, and for the right long-term investors, it may serve just right. As an aside, market leadership is in fact one of the factors we consider in constructing the market-beating Trefis High Quality portfolio (HQ) - a strategy of 30 stocks that targets long-term value creation. HQ has outperformed the S&P 500 and achieved returns greater than 91% since inception. Sure, I see the 24% return, however, what if Circle drops more than 60%, isn't there some risk? Of course, there is risk. Because, there are two ways this could unfold: In short, you win either way, especially if you're comfortable owning a high potential company like Circle for the long haul. Is that a good deal though? It could very well be, if you consider a couple of facts: If you do end up owning CRCL stock, you're not stuck with some speculative stock. You're holding a company that is: And The Risk of a Crash Is Lower Than You Think Selling puts is only as good as the business you're willing to own. While Circle stock is certainly expensive, its fundamentals are not too bad. The Bottom Line - Margin of Safety This trade offers an asymmetric risk-reward setup, with a built-in 60% plus discount. Either way, you come out ahead. Preserve & Grow Wealth With Risk-Focused Quality Portfolios These are the kinds of margin-of-safety setups and asymmetric risk-reward tradeoffs that we seek in the Trefis HQ portfolio, which is focused on long-term value creation. With a collection of 30 stocks, it has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.
