At the end of 2024, progress in quantum computing technology seemed to have reached an astonishing pace. The race to develop this promising, game-changing technology appears to be accelerating. Some of the headlines were dominated by big technology players, such as Alphabet Inc. NASDAQ:GOGFor example, In early December, it announced the Willow chipable to complete a calculation in about five minutes that would take non-quantum supercomputers an astonishing 10 septillion years to finish.
Rising participants in the quantum space are also making noise. Quantum computing company Nasdaq: Qubit In mid-December, it announced a major contract with NASA. In response, QUBT shares have skyrocketed, rising more than 450% in the past month as of December 19. This brings its one-year total return as of the same day to 1,420%.
The excitement over quantum computing stocks has also extended to little-known names. There are two companies in particular — Rigetti Computing Inc. Nasdaq: RGTI Arkit Quantum Company. Nasdaq: ARQQ– may be worth keeping in mind for investors looking to deepen their exposure to this fast-growing industry.
Righetti: Cash’s path to profitability, but it’s fraught with risks
One can hardly say that The market has completely ignored Righetti Last year. Shares of this quantum processor manufacturer have risen almost 585% during the year through December 19, 2024, which is a tremendous pace of growth, although it is still far behind its competitor, the quantum computing company. Almost all of these gains occurred in the final weeks of the year.
Righetti Computing Today
It ignores computing
(As of 05:45 PM ET)
- 52 week range
- $0.66
▼
$12.75
- Price target
- $4.80
On paper, Righetti’s recent rally appears to have pushed the company into overvalued territory. A price-to-earnings ratio of 172.9 suggests that investors may be overpaying for a company that has not yet seen sales rise. Furthermore, the company has yet to turn a profit, posting a net loss of more than $14 million in the third quarter.
What may convince investors to buy into RGTI stock even despite its recent rise, is its path to profitability. The company ended the third quarter with approximately $93 million in cash or cash equivalents, enough for a cash runway to expand operations while it puts the finishing touches on systems scheduled for release in 2025. Rigetti’s expected launches next year include both a 36-bit and a 100-qubit system based on On superconducting qubit technology that harnesses well-established semiconductor design processes. If these launches are successful, the recent rally may be just the beginning of a longer upward trajectory.
However, investing in Rigetti while the stock price is very high and before the company is profitable is inherently risky. More cautious investors might be better off comparing Rigetti to a large, established tech company with a nascent quantum computing business.
Arquette: Lots of big developments in 2024
Arqit’s involvement in the quantum space is unique: the company provides a cloud-based quantum cryptographic subscription service to protect highly secure data transmission. Shares rose more than 124% in the year ending December 19, 2024.
Arkit Quantum Today
(As of 05:40 PM ET)
- 52 week range
- $3.72
▼
$42.90
- Price target
- $27.00
Arquette has had an incredibly busy year. The company reported modest revenues of less than US$300,000 Fiscal year 2024which ended on September 30. However, it appears poised to significantly increase revenues, given that the company recently completed a multi-year contract with an unnamed government in the EMEA region. It is expected to generate annual recurring revenue in the seven-figure range.
The company has introduced cost-cutting measures to help it reduce the impact on its modest cash position of less than $19 million as of its fourth-quarter earnings report. Furthermore, the company completed a 25-for-1 reverse stock split in September, the same month it appointed a new CEO. With all this turmoil at the company, investors will likely be watching for signs of stability heading into the new year.
Arqit technology seems to be taking off, and interest in contracts is growing. However, the company is still burning through money at a rapid rate and has so far failed to achieve repeatable top- and bottom-line performance sufficient to sustain operations at this pace over the long term. However, investors with a long horizon and high tolerance for speculative investments could be rewarded for early interest in this quantum cloud computing company.
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