Mizuho bank slapped Circle Internet Group with a nasty rating today that sent shockwaves through Wall Street. The investment firm tagged the cryptocurrency company with an Underperform grade and set a measly $85 price target. Circle stock has been on a wild ride since going public in June with gains of 149 percent. The shares have tumbled 21 percent from their summer highs as reality sets in. Major banks keep warning that investors are paying way more than Circle is actually worth.
Circle makes its money from the USDC digital coin that people use for online transactions. Mizuho analysts think the market has gone crazy over Circle because Americans worry about government debt and spending. The bank believes Circle faces huge problems when interest rates start falling. Revenue predictions of $4.5 billion for 2027 look completely unrealistic according to their number crunchers. Other big investment houses like Goldman Sachs and JPMorgan have been saying similar things about Circle being overpriced.
The company has a messy deal with Coinbase that eats up most of its profits. Circle hands over half of all its revenue to Coinbase as part of their partnership agreement. Last year Circle paid out $1 billion in costs and Coinbase grabbed over 90 percent of that money. Mizuho thinks Circle will only make $3.3 billion in 2027 instead of the $4.5 billion everyone expects. The bank warns investors that Circle stock could drop another 30 percent from current levels.
Circle makes its money from the USDC digital coin that people use for online transactions. Mizuho analysts think the market has gone crazy over Circle because Americans worry about government debt and spending. The bank believes Circle faces huge problems when interest rates start falling. Revenue predictions of $4.5 billion for 2027 look completely unrealistic according to their number crunchers. Other big investment houses like Goldman Sachs and JPMorgan have been saying similar things about Circle being overpriced.
The company has a messy deal with Coinbase that eats up most of its profits. Circle hands over half of all its revenue to Coinbase as part of their partnership agreement. Last year Circle paid out $1 billion in costs and Coinbase grabbed over 90 percent of that money. Mizuho thinks Circle will only make $3.3 billion in 2027 instead of the $4.5 billion everyone expects. The bank warns investors that Circle stock could drop another 30 percent from current levels.
