The quantum computing industry is rapidly gaining momentum, with analysts revising price targets for key players in the sector.
This surge in interest stems from Google’s unveiling of its Willow chip, reigniting investor enthusiasm in the space. Additionally, a $2.7 billion U.S. government funding initiative aimed at accelerating quantum advancements has further propelled the sector.
Market projections estimate that the quantum computing industry could grow from $1.16 billion in 2024 to a staggering $12.6 billion by 2032, marking an annual growth rate of 34.8%.
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Reflecting this optimism, the Defiance Quantum ETF (QTUM) has surged 54% year-to-date, signaling investor confidence in the sector.
Market performance and analyst revisions
The renewed focus on quantum computing has sparked a surge of interest across pure-play companies, with Rigetti Computing (NASDAQ: RGTI), D-Wave Quantum Inc. (NYSE: QBTS), and IonQ (NYSE: IONQ) leading the way.
IonQ’s stock has surged an impressive 239% year-to-date, now trading at $41.32, while D-Wave Quantum has posted an extraordinary 893% gain, reaching $8.15. Rigetti Computing has outperformed both, delivering a staggering 1,091% increase, with its share price closing at $10.96 as of the market close on December 23.
This rapid growth has captured the attention of analysts, sparking a flurry of price target revisions.
DA Davidson analyst Alex Patt, for instance, initiated a buy rating for IonQ with a $50 price target, emphasizing its trapped-ion architecture and its ability to capitalize on the inadequacies of classical computing for complex problem-solving.
Similarly, Benchmark analyst David Williams has raised his price target for D-Wave Quantum from $3 to $8, citing improved market sentiment following the company’s successful balance sheet recapitalization, which resolved key financial risks.
Meanwhile, Craig-Hallum’s Richard Shannon maintained his $9 target, highlighting the retail-driven surge.
Despite the recent rally, Shannon noted that the enterprise values of quantum computing companies, ranging from $1 billion to $8 billion, remain significantly smaller compared to the $1 trillion market caps of classical computing giants they aim to disrupt, signaling room for long-term growth.
Additionally, Craig-Hallum initiated coverage of Rigetti Computing with a buy rating and a $12 price target citing its unique scaling advantages and its potential to achieve quantum superiority compared to its direct peers within the next few years.
That being said, for investors, these companies present a promising opportunity in a sector poised for substantial growth, albeit with risks inherent in a rapidly evolving industry.
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