Investing.com -- On Thursday, the stock prices of companies related to quantum computing experienced significant sell-offs, with four well-known companies witnessing sharp declines. Rigetti Computing (NASDAQ: RGTI) dropped by 26%, Quantum Computing Inc (NASDAQ: QUBT) dropped by 37%, D-Wave Quantum (NYSE: QBTS) dropped by 25%, and Quantum Corporation (NASDAQ: QMCO) plummeted by 39%.
The sharp decline seems to be due to a shift in investor sentiment, as they are reassessing the soaring valuations of the quantum computing sector. Despite the losses on that day, these companies have still seen remarkable year-to-date (YoY) gains, with Rigetti Computing rising by 700%, Quantum Computing rising by 1500%, D-Wave Quantum rising by 650%, and Quantum Corporation rising by 450%. The sector has always been a favorite for momentum traders, but doubts about the current capabilities of the technology and concerns about overvaluation have now become the focus.
Adding fuel to the fire, the aggressive short-selling institution Citron Research recently targeted Quantum Corporation on social media. They criticized the industry, with a specific focus on the financial situation of Quantum Computing Inc. The comments from this short-selling institution about the differences in R&D spending of small-cap quantum companies, along with comparisons to tech giants, have raised doubts about the current valuations.