To The Moon

Figma stunned the market last week with a jaw-dropping 270% surge, but the celebration might already be fading. Despite the strong debut, many investors are beginning to question whether the hype is truly justified or if Figma is simply flying too close to the sun.

Figma (FIG)

Compared to other recent IPOs like Circle, which benefits from its ties to the crypto ecosystem and speculative momentum, Figma stands on shakier ground. It’s a pure software play, without the hype machine of Web3 or blockchain behind it and now that Figma options are officially trading, traders might be wondering if this is the perfect setup to short the stock all the way down to $50.

Circle Internet Corp. (CRCL)

But here’s my honest take: I’m not touching this stock. Not to buy the dip. Not to short it. Nothing.

Yes, Figma has made a name for itself in the design space. It's popular, widely adopted, and part of many teams' workflows. But that doesn’t mean the current valuation makes sense. Even after a dip, I believe the stock still looks overvalued, especially when you look under the hood at its financials. The company's net income and overall profitability haven’t shown the kind of strength needed to justify such a lofty market cap.

More importantly, this stock is incredibly volatile, which to be fair, isn’t unusual for a freshly IPO’d name. New listings often swing wildly as the market tries to find a fair price, but personally, I’m not a fan of that kind of turbulence. I prefer companies with a proven financial track record and some level of price stability. Figma doesn’t check either of those boxes right now.

And while the idea of shorting with options might sound tempting given the current pullback, I won’t be going that route either. Shorting a volatile IPO is a high-risk game. Yes, it could crater but it could just as easily spike on news, momentum, or pure speculation. Timing that kind of move is a gamble, not a strategy.

So for now, I’m sitting on the sidelines. Figma might turn out to be a great company in the long run, but at this moment amid inflated valuations and wild price swings, I’m more comfortable watching from a safe distance.