Circle Boosts Revenue 53%. How Should You Play CRCL Stock Here?
Circle (CRCL) stock opened some 15% up on Tuesday morning after the stablecoin issuer reported an exciting 53% year-over-year increase in revenue to $658 million in its fiscal Q2.
However, the firm swung to $482 million of net loss or $4.48 a share, notably worse than $32.9 million of earnings in the same quarter last year.
Still, CRCL shares are pushing to the upside as investors continue to focus more on top-line growth. Versus its initial public offering (IPO) price, the crypto stock is currently up some 420%.
Is Q2 Loss a Threat for Circle Stock?
While nearly $500 million of quarterly loss does look alarming on the surface, much of it was in fact related to IPO-related charges.
Simply put, it only reflects accounting adjustments, not operational losses, or structural headwinds facing Circle shares. So, bottom-line weakness will likely prove a one-time event for the Nasdaq-listed firm.
CRCL stock may be worth buying on the post-earnings decline also because the fintech firm sees the amount of USDC in circulation growing at a compound annualized rate of 40% going forward.
Note that the crypto stock is priced attractively at writing as well after losing more than 45% from its post-IPO highs.
How High Could CRCL Shares Fly in 2025?
Circle’s strong earnings feed right into the bullish view that Gautam Chhugani, a senior Bernstein analyst, shared with clients in his latest research note.
Ahead of the company’s quarterly release, Chhugani maintained his $230 price target on CRCL stock, saying it’s a “must-hold” for investors seeking exposure to the expected long-term growth in tokenized finance and stablecoin adoption.
According to Bernstein, the stablecoin market will grow from roughly $225 billion today to about $4 trillion over the next decade.
Its $230 price target on Circle shares indicates potential upside of another 35% from current levels.
Wall Street’s View on Circle Internet Group
Investors could also take heart in the fact that other Wall Street firms also forecast at least a little more upside in Circle stock.
While the consensus rating on CRCL shares currently sits at “Hold” only, the mean target of about $184 suggests potential for a 12% rally from here.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.