Circle’s Q3 results show resilience despite rate cut fears and competition from ‘frenemies,’ claims Bernstein
The Block
Bernstein analysts assert Circle's fundamentals are robust following strong Q3 results, despite stock weakness due to rate cut fears.Summary
Bernstein analysts maintain a positive long-term thesis for Circle, citing robust Q3 earnings that surpassed estimates, with $740 million in revenue and $166 million in adjusted EBITDA. They argue that recent stock weakness stems from misplaced fears about interest-rate cuts and competitive pressures, not structural deterioration. Key strengths noted include sustained USDC growth, improving profitability (adjusted EBITDA margin expanded to 57%), and the development of the Arc Layer 1 blockchain, which may feature a native token. Bernstein believes USDC's liquidity advantage remains a significant edge against competitors like Stripe, and they remain bullish, maintaining an 'outperform' rating and a $230 price target.
(Source：The Block)