Circle’s Valuation Seen as Fair by Citi, Which Launches Coverage With a Buy Rating

Citi Launches Coverage on Circle With Buy Rating, Predicts 34% Upside

Citigroup has initiated research coverage of Circle (CRCL), expressing confidence in the company’s ability to lead stablecoin adoption. In a note published Monday, Citi analysts rated the stock as a Buy with a High Risk label, assigning a price target of $243—suggesting an upside of about 34% from Monday’s close near $181.

Even after a significant rally since its IPO, Citi argues that Circle’s valuation remains attractive. The company went public at $31 per share and surged to a peak of $299 last week before settling back to its current level.

Stablecoins, digital assets tied to the value of fiat currencies like the U.S. dollar or commodities such as gold, play a vital role in the crypto ecosystem, facilitating trading and enabling smooth cross-border payments.

Peter Christiansen and his team at Citi highlighted several factors fueling Circle’s growth prospects: its scarcity value, a “winner takes most” market dynamic, vast market opportunities, positive regulatory trends, and strong operating leverage.

“Circle’s biggest advantage is its neutrality,” the report said. “It’s crucial for Circle to fend off stablecoin fragmentation and maintain its leadership position.”

Because Circle operates with minimal capital needs and significant operating leverage, Citi believes the company could achieve substantial returns if it captures a leading share of the expanding stablecoin market.

However, opinions on Wall Street remain divided. JPMorgan, for instance, also initiated coverage of Circle on Monday but assigned the stock an Underweight rating, voicing caution over its valuation.