Overview
- Shares fell after Compass Point cut Circle to Sell with a $77 target, and the stock slid roughly 7% to 10% intraday in the selloff.
- Compass Point estimates about 80% of recent USDC growth came through revenue‑sharing partners such as Binance, Sky, and Ethena, which reduces Circle’s share of interest earned on reserves.
- The firm now models first‑quarter EBITDA down 19% from the prior quarter and pegs 2027 EBITDA about 20% below Wall Street’s consensus.
- Other coverage stayed cautious rather than bullish as Goldman Sachs kept a Hold rating and inched its price target to $99, while FactSet shows roughly half of analysts at Buy with an average target near $131.
- Circle’s latest quarter showed $733 million of $770 million in revenue came from reserve interest, so profits depend on where USDC circulates and on the yield environment while new products still contribute little.