NVDA
NVIDIA
-- 139.670 TSLA
Tesla
-- 430.600 AMD
Advanced Micro Devices
-- 124.600 RGTI
Rigetti Computing
-- 10.9600 PLTR
Palantir
-- 80.690 
Rigetti (RGTI) Cash Runway Healthy But Current Price Suggest Risk
As we are at the end of 2024, the excitement over quantum computing stocks has grown faster than before.
The race to develop this promising, game-changing technology seems to only be speeding up. Major tech players have dominated some of the headlines, $Alphabet-A (GOOGL.US)$ , for example, announced in early December its Willow chip, capable of completing in about five minutes a computation that would take non-quantum supercomputers an astonishing 10 septillion years to finish.
Quantum Computing (QUBT) Year-To-Date Return
I think we have been looking at $Quantum Computing (QUBT.US)$ which announced in mid-December a major contract with NASA. In response, shares of QUBT skyrocketed, climbing by more than 450% in the last month as of December 19.
This brings their year to date return as of 23 Dec 2024 to a whopping 1,636%. But I think we can also look at other quantum computing stocks.
Rigetti (RGTI) Up More Than 1000%
If you have been following the quantum computing stocks for 2024, you will not overlook $Rigetti Computing (RGTI.US)$ entirely, because this maker of quantum processors are already up more than 1000% year-to-date as of 23 December 2024.
Though there are still far behind its rival Quantum Computing, but the tremendous pace of growth is something we need to be aware, and the gains mostly took place in the final weeks of 2024, so I am expecting this to continue into 2025.
Rigetti (RGTI) Stock Price Looks Expensive Now
If we looked at Rigetti's recent rally, it seem to have catapulted the company into overvalued territory. With a high P/S ratio of 172.9 and the average ps ratio for Rigetti Computing (RGTI) stock was 32.54 over the past 12 months.
This suggest that investors might be overpaying for a company which has not yet to see their sales taking off. One more thing to note is RGTI is not yet profitable, it reported a net loss of more than $14 million for the third quarter.
Why Investors Are Still Buying Into RGTI
For companies like RGTI which is into a new technology, and they will not be profitable yet or might took a long time, what is important to note is their path of profitability.
Meaning if this company can survive further by maintaining its operation before its release of next system.
RGTI ended the third quarter with almost $93 million in cash or equivalents, this show that their cash runway is enough to extend operations to allow them to continue working on systems planned for release in 2025.
In 2025, Rigetti’s launches of both a 36-qubit and a 100-qubit system based on superconducting-qubit technology that harnesses established semiconductor design processes would be watched.
So we might expect longer and higher upward movement, much better than the recent rally if these two launches are successful.
But as investors, depending on your own risk appetite, investing in Rigetti when the share price is so high before the company go into profitability is considered risky, so a better approach might be to also look into large technology companies which are already selling quantum computing.
Technical Analysis - MACD and Multi-timeframe (MTF)
No doubt that we are seeing a significant increase in the buying volume over the past one week, and it is still growing, and technical suggest that RGTI is trading comfortably above the short-term and long-term MA, MACD is still in an upside movement, though there is a signs of coming down.
MTF is giving strong upward trend, but we need to be aware that there might be some correction coming for RGTI especially when the current stock price does not really explain why RGTI performance deserve so.
So I am expecting RGTI stock price to go for a correction in 2025 first two weeks, hence, that might be the time we can look at getting into this quantum computing if the risk profile suits you.
Summary
While there is much potential on quantum computing, but we need to remember that this technology require a high CAPEX investment in order to really turn profitable.
So if the company could start showing making sales and getting some money and attracting investment into it, else even though the cash runway is healthy as of now, we might see problems if customers start to place order and order fulfillment run into issues.
So I would continue to monitor the development of the quantum computing sector, especially how the big boys technology companies are gearing up.
Appreciate if you could share your thoughts in the comment section whether you think Rigetti would be able to make a successful launches of its two qubit systems and begin its path into profitability in 2025.
Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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David 889 : I have been waiting for it to pull back, the deeper the pullback, the better!