90-year-old bank boosts Circle price target
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90-year-old bank Morgan Stanley has revamped the price target for Circle Internet (NYSE: CRCL).
The boost from analyst James Faucette was based on higher yield assumptions and a revenue tailwind from the Arc token presale.
Related: Analyst predicts 60% upside for Circle stock on bill compromise
Arc and reserve income fuel upgraded estimates
The revised estimates took into consideration approximately $222 million in additional other revenue from the Arc token presale. The presale took place on May 8, and its financials were announced on May 11.
The presale contribution helped push the firm's 2027 reserve income estimates up by roughly 28%.
The bank noted it would prefer to see enterprise agentic use cases develop and scale before considering a higher multiple.
Morgan Stanley raised the price target for Circle to $106 from $80, a 32.5% increase, while maintaining an Equal Weight rating on the stablecoin issuer's shares, as per Investing.com.
Morgan Stanley also raised its 2028 GAAP diluted earnings per share estimate to $4.23 from $3.18, an increase of about 33%.
This marks the second consecutive price target upgrade from Morgan Stanley. Following Circle's fourth quarter of 2025 earnings, where the company reported EPS of $0.43, beating estimates of $0.35 by nearly 23%, the bank raised its target from $66 to $80.
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USDC growth remains a watchpoint
Despite the bullish revision, Morgan Stanley continues to embed an approximately 40% compound annual growth rate for USDC, Circle's stablecoin, in circulation through 2028, even as USDC has struggled to grow beyond $80 billion this year.
As of press time, USDC holds a 23.86% share of the total stablecoin market, well behind Tether's USDT at around 58.71%, according to DeFiLlama.
The CLARITY Act's passage out of the Senate Banking Committee was flagged as a positive development for Circle and the broader digital asset sector.
However, Faucette cautioned that the bill is not yet law, with the Senate floor vote and potential revisions remaining key hurdles for investors to watch.
Related: Markets surge as Clarity Act clears Senate committee in landmark 15-9 vote
