While the technology will bring countless innovations, investors should reserve the best quantum computing stocks for the speculative long-term portion of their portfolio. Essentially, it depends on the projected relevance.
According to Grand View Research, the global quantum computing market will reach $1.05 billion in 2022. Experts predict that the sector could grow at a compound annual growth rate (CAGR) of 19.6% from 2023 to 2030. At its peak during the forecast period, the segment could generate revenue of $4.24 billion.
Better yet, they may only be getting started. According to McKinsey & Company, quantum technology itself could lead to trillions of value creation. Essentially, quantum computers represent a paradigm shift from classical approaches, as these devices could perform countless functions simultaneously, leading to explosive productivity gains.
To be sure, every breakthrough field comes with significant risks. If you’re willing to pay the premium, consider these quantum computing stocks.
Honeywell (HON)
Honeywell (NASDAQ:HON) is certainly not one of the more straightforward names in quantum computing’s top stocks. The company is an industrial and applied science conglomerate with expertise in countless fields. But Honeywell is crucial to the world of advanced computing thanks to its investment in Quantinuum.
Earlier this year, Honeywell’s quantum computing company was valued at $5 billion after a $300 million equity financing round, according to Reuters. Notably, JPMorgan Chase (NYSE:JPM) helped secure the investment. According to the news agency, “companies are exploring ways to develop and scale quantum capabilities to solve complex problems such as designing and manufacturing hydrogen cell batteries for transportation.”
Honeywell could play a big role in the application of quantum computing, leading to a worthwhile long-term investment. To be honest, this is not the most exciting game in the world. Analysts rate the stock as a “moderate buy,” but their average target price is $229.21. That means there’s room for upside of about 10%.
Still, Honeywell probably won’t go bust either. When building a portfolio of the best quantum computing stocks, having a reliable anchor like HON could be worthwhile.
IonQ (IONQ)
Let’s move on to one of the more exciting names among the top quantum computers: IonQ (NYSE:IONQ). IonQ is based in College Park, Maryland and operates primarily in the computer hardware sector. According to its public profile, the company is working on developing a universal quantum computing system. On the business side, IonQ sells access to quantum computers with various qubit capacities.
Analysts are very optimistic about IONQ stock and rate it a Buy. Moreover, the average price target is $16.63, suggesting room for upside of over 109%. And that’s not all. The most optimistic target is a price of $21 per share. In this case, they are talking about a return of over 164%. Of course, IONQ is a high-risk company, with a relatively modest market cap of $1.68 billion.
Despite concerns such as a widening deficit in fiscal 2024, experts believe the growth story can overcome the concerns. Specifically, it is targeting revenue of $39.47 million, up 79.1% from last year’s $22.04 million. Furthermore, revenue could increase significantly to $82.38 million in fiscal year 2025. It is one of the most noteworthy stocks related to quantum computing.
Rigetti Computing (RGTI)
Rigetti Computing (NASDAQ:RGTI) is headquartered in Berkeley, California, and builds quantum computers and superconducting quantum processors through its subsidiaries. Notably, Rigetti offers cloud-based solutions under the Quantum Processing umbrella. It also sells access to its groundbreaking computers through a business model it calls Quantum Computing as a Service.
RGTI stock is interesting, but it comes with a lot of risk. In fact, the company has a market capitalization of just over $175 million. That’s 2 cents on every dollar the stock is worth. With such a small profile, anything can happen. Still, analysts unanimously rate the stock a Strong Buy, which makes it attractive. Moreover, the average price target is $3, suggesting room for upside of over 194%.
The financial forecast is even more attractive. Experts expect Righetti to post a loss of 41 cents per share, an improvement from last year’s loss of 57 cents. Moreover, revenue could reach $15.3 million, up 27.4% year over year. And revenue in fiscal 2025 could grow to $28.89 million, which would be nearly 89% higher than the projected revenue for 2024.