Wall Street split on Circle stock as JPMorgan, Goldman warn on valuation

Major Wall Street firms have begun their coverage of Circle’s stock, but projections diverge widely.

Circle’s successful IPO is catching the attention of Wall Street. On Monday, June 30, after the mandatory quiet period ended, major financial institutions began coverage of the stock. Firms including Barclays, Bernstein, and JPMorgan released their ratings and price targets.

Barclays, Bernstein, Canaccord Genuity, and Needham all set Circle’s stock price target above $200, implying upside potential of around $15 per share from its current price. The bullish case centers on Circle’s potential to expand its stablecoin business and its competitive advantages.

“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.

Circle is likely overvalued: Goldman Sachs, JP Morgan

Still, while most ratings are bullish, JPMorgan and Goldman Sachs offered more cautious perspectives. JPMorgan set a price target of $80—59% below the current trading price of $185. While the bank praised Circle’s business model, it flagged the valuation as excessive.

“Circle and USDC have an early-mover advantage in what has been a winner-takes-most market, driving USDC market capitalization to $62 billion. We think highly of the Circle management team and are confident in the outlook for outsized stablecoin and USDC growth. However, we see Circle’s current market capitalization elevated,” Kenneth Worthington, JPMorgan analyst.

At the same time, the investment bank Goldman Sachs agreed with the sentiment. Analysts from Goldman Sachs started the coverage with a neutral rating and put the price target on the stock at $83.

“Together, pending global stablecoin regulation that should favor adoption of compliant stablecoins like USDC, as well as continued new partnerships should drive continued market share gains,” James Yaro, Goldman Sachs, stated. “We view CRCL’s business and growth attractively, but valuation appears elevated,” he added.