Ionq D Wave Quantum Rigetti Computing In Focus As Jefferies Starts

Quantum computing is generating about $1 billion in revenues today and has a potential “total addressable market” of up to $198 billion by 2040, according to analyst Kevin Garrigan and his colleagues at Jefferies.Garrigan... Coincidentally, Wedbush also today initiated coverage of those companies along with a fourth, Quantum Computing Inc. It rated all of them as “outperform” except for QCI, which it graded as neutral.All three companies covered by Jefferies emerged from U.S. academic research labs more than 10 years ago, but financially they still look like well-funded startups. D-Wave and IonQ are both growing but unprofitable. The former reported Q3 revenue was up 100% to $3.7 million but with a net loss of $140 million; the latter disclosed Q3 revenue of $39.9 million, up 222% on a net loss of...

Rigetti reported a decline in Q3 revenue of 18% to $1.9 million and a loss of $201 million, but also disclosed new incoming contract agreements worth $11.5 million. QCI is profitable, and it reported growing Q3 revenues, but the size of its business is currently tiny: It booked only $384,000 in sales for the period.In “classical” computing, computer chips and software solve... Quantum computers, by contrast, use the principles of quantum uncertainty in subatomic physics to represent information as “qubits” that can be 1, 0, or both at the same time. This ability to present information in “superposition” (roughly, in simultaneous parallel) makes quantum computers potentially very powerful. “A classical computer is like reading every book in the library one by one to find an answer. A quantum computer is like being able to read all the books at once,” the team at Jefferies wrote in a note to clients seen by Fortune.

A fully functioning quantum computer can, in theory, tackle complex problems in five minutes that classical computers would need 10 septillion years of processing to solve. The downside is that the physics and engineering needed to make quantum computers work have only just moved out of the theoretical realm and into reality. Nonetheless, “as quantum moves from lab to applied pilots, a specialized industry is emerging for components, such as cryogenics (dilution refrigerators), lasers/optics, and control electronics, that increasingly supplies multiple hardware stacks,” the Jefferies analysts... That industry is being funded by governments and large tech companies like Google and IBM. Wedbush analysts Antoine Legault and Matt Bryson have almost the exact same theory: “We expect that by the end of the decade quantum computing companies will represent a larger share of the total spend... Specifically, we project quantum computing spend on the four covered companies could reach just under 2% of total compute expenditures by 2030, from virtually nothing today, as the technology moves from research to commercial...

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IonQ (NYSE: IONQ), D‑Wave Quantum (NYSE: QBTS), and Rigetti Computing (NASDAQ: RGTI) are three closely watched pure‑play stocks in the quantum computing sector. Read how each is pursuing a different path toward commercial adoption as quantum technology begins moving from the lab into real financial applications. Shares of IonQ and D-Wave Quantum are soaring on Tuesday after Jefferies initated coverage on the stocks with “buy” ratings and price targets of $100 and $45, respectively. Rigetti Computing, which Jefferies started with a “hold” rating and $30 price target, is modestly lower. These three quantum computing companies are all down between 40% and 60% from their October all-time highs. All 13 analysts who cover D-Wave have a “buy” (or equivalent) rating, while 75% of the dozen on Wall Street who have a rating on IonQ recommend the stock.

While the speculative AI-linked stocks continue to largely get crushed, this pocket of the market also favored by retail traders is showing some signs of life. Please use a PC Browser to access Register-Tadawul BUZZ-Jefferies starts coverage on quantum computing cos, bullish on D-Wave and IonQ ** Shares of quantum computing cos D-Wave Quantum QBTS.N, IonQ IONQ.N are marginally up, and Rigetti RGTI.O slightly down in premarket ** Jefferies initiates coverage on QBTS and IONQ with "buy" ratings and PT $45 and $100, respectively, and RGTI with "hold"; PT $30 ** Brokerage says QBTS is supported by ecosystem growth, a two-pronged roadmap, a full-stack platform, and strong enterprise workload stickiness

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