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▲ Circle, USDC, Stablecoin, Dollar (USD)/ChatGPT generated image
Ahead of Circle Internet Group (CRCL)'s second-quarter earnings announcement, short sellers and bullish investors clashed. The market's attention is focused on whether it will turn profitable.
According to crypto-focused media Benzinga on August 4 (local time), Circle will announce its second-quarter earnings before the opening of the US stock market on Wednesday. The market's expected earnings per share (EPS) is $0.19. It is projected to turn profitable from a loss of $0.43 in the same period last year. Expected revenue is $734.7 million, an increase of 11% from the same period last year and approximately 6% from the first quarter.
Circle surpassed its first-quarter EPS forecast, but revenue fell short of market expectations. The average investment opinion presented by 21 analysts is 'Buy'. The average target price is $120, which Benzinga reported was approximately 99% higher than the stock price at the time.
TD Cowen initiated coverage on Circle with a 'Buy' rating and a target price of $82. TD Cowen analyst Bryan Bergin highlighted the expansion of USDC circulation and the rapid growth of its fee-based business. Bergin assessed that Circle possesses "an attractive combination of growth potential and business diversification."
Bearish pressure is also strong. Circle's short interest increased to 27.11 million shares, accounting for 12% of outstanding shares. In the options market, however, there were more call option purchases than put options. This indicates an influx of bullish bets anticipating improved earnings. The Bull/Bear Power indicator, which measures the strength of buyers and sellers, recorded 'Neutral'.
Circle considers interest income generated from USDC reserve assets as its core revenue source. Most of the reserve assets consist of short-term US Treasury bonds and cash. However, USDC circulation in the second quarter decreased by 4.6% to $73.77 billion. Circle's stock price has fallen by approximately 24% since the beginning of the year, and in Benzinga's stock rankings, its short-term, medium-term, and long-term price trends were all rated as weak.
[Article Key Summary]
-Circle's Q2 expected EPS is $0.19, projected to turn profitable from a loss of $0.43 in the same period last year.
-Short interest increased to 27.11 million shares, reaching 12% of outstanding shares, but the options market showed bullish bets centered on call options.
-Q2 expected revenue is $734.7 million, but USDC circulation decreased by 4.6% to $73.77 billion.
*Disclaimer: This article is for investment reference only, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*
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