TLDR
- Rigetti Computing stock jumped 9% on Thursday, closing at $46.96 despite broader market weakness
- Benchmark analysts raised their price target from $20 to $50 per share earlier this week, citing improved cash position and wider product portfolio
- The company secured a $5.8 million three-year contract with the Air Force Research Laboratory and $5.7 million in purchase orders for quantum systems
- Rigetti generated just $1.8 million in revenue while posting a $19 million operating loss in recent results
- The stock has surged over 5,000% in the past 12 months but trades at a price-to-sales ratio of 1,100
Rigetti Computing closed Thursday’s session up 9% at $46.96 per share. The quantum computing company bucked the broader market trend as the S&P 500 fell 0.3% and the Nasdaq Composite declined 0.1%.
The stock had climbed as high as 11.5% during the trading day before pulling back. Quantum computing stocks saw generally positive momentum across the sector.
Analyst Coverage Drives Momentum
Benchmark raised its price target on Rigetti from $20 to $50 per share on Tuesday. The firm maintained a buy rating on the stock.
The analysts pointed to Rigetti’s improving cash position as a key factor. They also cited the company’s expanding product portfolio and growing support from the broader tech industry.
Even after the recent rally, Benchmark’s $50 price target suggests about 6% upside from current levels. The stock has now surged more than 5,000% over the past 12 months.
Recent Contracts Provide Revenue
Rigetti recently secured a three-year contract worth $5.8 million with the Air Force Research Laboratory. The company will help develop new chip fabrication technologies alongside Iowa State University and the University of Connecticut.
The company also announced purchase orders for two Novera quantum computing systems valued at $5.7 million. Delivery is expected in the first half of 2026.
These deals represent votes of confidence in Rigetti’s technology. The company is pursuing a pick-and-shovel business model similar to Nvidia.
Rigetti offers chips, processors, and infrastructure for quantum computing applications. The company is also developing Quantum Cloud Services, which would make quantum computing power accessible through traditional cloud infrastructure.
Financial Reality Remains Challenging
The company’s recent financial results paint a different picture. Rigetti generated just $1.8 million in revenue in its latest reporting period.
Operating losses totaled about $19 million during the same timeframe. Research and development expenses are eating into the bottom line.
These costs are difficult to reduce given the cutting-edge nature of quantum engineering. Quantum computing technology remains experimental and not yet ready for widespread commercial use.
McKinsey & Company estimates the quantum computing industry could reach $100 billion in value within a decade. The technology promises to revolutionize pharmaceutical drug discovery, logistics, and materials science.
However, sustainable commercialization could still be years or decades away. Current quantum machines are primarily used for research and experimentation rather than profit-driven applications.
Valuation Concerns Mount
Rigetti’s stock now trades at a price-to-sales ratio of 1,100. This compares to the S&P 500 average of 3.4.
The company’s market cap stands at $15 billion. The 52-week trading range stretches from $0.74 to $48.23 per share.
Trading volume on Thursday reached 2.5 million shares. Average volume stands at 63.5 million shares.
The company’s gross margin remains negative at -39.99%. Investors who buy at current levels could face years of losses before the company achieves sustainable profitability.
Some investors are betting that quantum computing will become a competitive advantage in artificial intelligence and cryptography applications. Geopolitical tensions between the U.S. and China may also be driving interest in quantum technology stocks.
Rigetti closed Thursday’s session with the stock price at $46.96, maintaining its position near recent highs despite questions about valuation and the long timeline to profitability.
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