Circle Stock Heads For Steepest One-Day Drop Since June – Wall Street Cuts Price Targets

• Circle stock posted double digit loss on Thursday, amid broader weakness in the technology industry.
• JPMorgan said the quarter's beat came from a lower-than-expected tax rate and more ARC token presale revenue than it had modeled.
• Wells Fargo and Mizuho flagged weaker margins ahead, while TD Cowen said Circle's payments network and Arc blockchain are gaining early traction.

Shares of Circle Internet Group (CRCL) plunged on Thursday, on track for its worst day since June, after a slew of Wall Street firms lowered their price targets and analysts questioned the extent to which the stablecoin issuer's third-quarter beat was powered by a one-time token sale.

CRCL stock was down roughly 12% in midday trade, amid broader weakness in the tech market. 

Read Next

OpenAI-Linked Oracle Data Center Reportedly Faces Fresh Power Permit Delay In New Mexico

Anan Ashraf

On Stocktwits, retail sentiment around CRCL remained in the 'bearish' zone, while chatter shifted from 'high' to 'normal' levels over the past day.

Compass Point Upgrades Circle

Compass Point upgraded Circle to 'Buy' from 'Neutral' with a $99 price target. The firm said it remained cautious about how quickly USD Coin would gain mainstream adoption, but still called Circle "the best large-cap proxy for crypto exposure" and described the upgrade as a tactical trade into year-end and fourth-quarter results.

Mizuho analyst Dan Dolev raised the target on CRCL to $46 from $43 but kept an 'Underperform' rating. He called Circle's third-quarter report "uneventful" and said its fourth-quarter margin outlook "seems soft."

Analysts Flag Slowing Core Business

JPMorgan analyst Kenneth Worthington cut the firm's price target to $100 from $110 and kept an 'Overweight' rating. He said the beat came from a lower-than-expected tax rate and more ARC presale revenue than he had modeled. JPMorgan also said Circle's core business was slowing as USDC's market cap declined.

Wells Fargo analyst Jason Kupferberg lowered the price target to $101 from $115 and also kept an 'Overweight' rating. He called the third quarter robust and noted that Circle reiterated its 2026 guidance. But he said the renewed Binance (BNB) contract was weighing on Circle's fourth-quarter margin on revenue less distribution costs, and expected 2027 margin estimates to come down.

Some See Growth Beyond Reserves

TD Cowen cut its target to $87 from $92 and kept a 'Buy' rating, calling the third quarter a strong strategic one for Circle. The firm said USDC circulation has stalled, but the Circle Payments Network and Arc are showing meaningful early traction. That supported the case that Circle could grow beyond a business driven by reserve income, the firm added.

Susquehanna analyst James Friedman also lowered the price target to $86 from $92 and kept a 'Neutral' rating. He pointed to rapid growth in the Circle Payments Network, whose annualized payment volume had jumped 181% from the previous quarter to over $41 billion. He also said the renewed five-year Binance partnership and the proposed Tazapay acquisition would be key to delivering Circle's roadmap.

Clear Street analyst Owen Lau cut his target to $98 from $107 and kept a 'Buy' rating. Keefe Bruyette lowered its target to $90 from $105 with a 'Market Perform' rating, while Goldman Sachs trimmed its target to $81 from $90 and kept a 'Neutral' rating.

Token Sale Lifts Q3 Revenue

Circle reported that in its third-quarter revenue of $865 million, beating analyst expectations by about $76 million dollars, according to Koyfin data. The revenue included $182 million from the presale of ARC, the token for its new Arc blockchain. Circle's income on reserves backing USDC dropped by 8% to $658 million, with returns on the reserves falling to 3.5%.

The stablecoin issuer’s earnings per share (EPS) came in at $0.93, well above the $0.42 per share analysts’ estimate. 

CRCL stock is down over 15% so far this year and lost over 40% in the last 12 months.

Read also: KEEL Stock Hits 14-Month Low: Q3 Report Reveals Firm Sold All Its Bitcoin But Has No Data Center Leases Yet

For updates and corrections, email newsroom[at]stocktwits[dot]com.