Bernstein gives Circle an "Outperform" rating with a target price of $230.

According to Gate News bot, The Block reported that research and brokerage firm Bernstein has given its first rating to stablecoin issuer Circle, assigning it an "Outperform" rating with a target price of $230.

Analysts from Gautam Chhugani's team pointed out that Circle is building a leading digital dollar stablecoin network with regulatory advantages, liquidity advantages, and high-quality partners. They believe CRCL is a key investment for laying out the new infrastructure of internet finance for the next decade.

Analysts expect that the total supply of stablecoins will increase from the current $244 billion to $4 trillion over the next ten years, a growth of 16 times. This growth will come from the development of cryptocurrency and tokenized capital markets, payment systems, and native financial services for stablecoins.

Chhugani emphasized that with the passage of the U.S. "GENIUS Act," USDC will become the largest regulated stablecoin, and this advantage makes it the preferred partner for internet platforms. Circle's $61.4 billion liquidity reserve is difficult for new entrants to replicate.

However, Bernstein predicts that Circle can only capture 30% market share. Currently, Tether still occupies 65% market share with a supply of $158.5 billion. Tether may need to establish a US subsidiary to meet new regulatory requirements.

Bernstein uses a ten-year discounted cash flow model to give a valuation of $230, corresponding to about 35 times the adjusted EBITDA for 2027. They expect the company's revenue to grow at a compound annual growth rate of 47% from 2024 to 2027, with EBITDA growth of 71%.