TLDR
- Rigetti Computing stock jumped 11.07% on Monday to $8.33 per share
- New leveraged ETF (RGTX) launched by Defiance ETFs offers 2x daily exposure to RGTI
- Despite recent 19.8% monthly decline versus S&P 500’s 12.1% drop
- Analysts project improved earnings with losses narrowing to $0.20 per share for current fiscal year
- Revenue expected to grow 34.6% this year and 159.3% next fiscal year
Rigetti Computing’s stock made impressive gains on Monday, rising 11.07 percent to close at $8.33 per share. The quantum computing company bucked the broader market trend as major indices showed mixed results.
The Dow Jones declined by 0.91 percent while the S&P 500 dropped 0.23 percent. The tech-heavy Nasdaq managed a slight increase of 0.10 percent.
Rigetti was part of a group of AI-related stocks that performed well despite market concerns over escalating global trade tensions. President Donald Trump has threatened China with another 50-percent tariff if the country doesn’t withdraw a recent countermeasure.
The company’s shares rose alongside other quantum computing peers. These included IonQ Inc. (RGTI) and Super Micro Computer Inc. (SMCI).
New ETF Creates Trading Opportunity
A recent development has caught investor attention. Defiance ETFs launched RGTX, the Defiance Daily Target 2X Long RGTI ETF.
This new investment vehicle is designed to provide amplified exposure to Rigetti’s stock performance. It seeks daily investment results corresponding to 200 percent of RGTI’s daily percentage change.
The ETF offers traders enhanced returns potential without requiring a margin account. This makes leveraged exposure to the quantum computing company more accessible to retail investors.
“RGTX offers investors a way to seek leveraged exposure to RGTI, a known leader in quantum computing technology,” said Sylvia Jablonski, CEO of Defiance ETFs. “As Rigetti continues to develop its proprietary quantum processors and expand its Quantum Computing as a Service (QCaaS) platform, this ETF provides a trading tool for those looking to engage with the company’s market performance.”
Financial Performance and Outlook
Despite Monday’s gains, Rigetti shares have faced challenges recently. The stock has returned -19.8% over the past month, underperforming the S&P 500’s -12.1% decline during the same period.
The broader internet software industry, to which Rigetti belongs, has lost 21% in this timeframe. However, analyst expectations show potential bright spots ahead.
Earnings projections for Rigetti have improved. The company is expected to post a loss of $0.05 per share for the current quarter, representing a year-over-year improvement of 64.3%.
For the current fiscal year, the consensus earnings estimate stands at -$0.20 per share. This indicates a 44.4% improvement from the previous year. These estimates have been revised upward by 29.1% over the last 30 days.
Revenue projections also point to growth. While the current quarter estimate of $2.46 million represents a year-over-year decline of 19.3%, the outlook improves significantly looking forward.
For the full fiscal year, analysts expect revenues of $14.52 million, a 34.6% increase. Next fiscal year looks even stronger, with projected revenues of $37.65 million representing a substantial 159.3% growth rate.
In its most recent earnings report, Rigetti posted revenues of $2.27 million. This was below analyst expectations of $2.4 million and represented a 32.8% year-over-year decline.
The company reported a loss of $0.08 per share, slightly better than the $0.09 loss from the same period a year ago. Over the past four quarters, the company has exceeded EPS estimates only once.
Based on these improving fundamentals, Zacks has assigned Rigetti a Rank #2 (Buy) rating. This positive outlook comes despite valuation concerns, with the stock trading at a premium compared to industry peers.
Rigetti ranked fifth on a recent list of top-performing AI stocks. The company’s quantum computing technology continues to generate interest as the broader artificial intelligence sector experiences renewed momentum.
Rigetti Computing will need to deliver on its growth projections to justify its current valuation and maintain investor confidence. Monday’s stock performance suggests market participants see potential in the company’s quantum computing developments and its position within the expanding AI ecosystem.
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