Rigetti Computing, a U.S.-based quantum computing company, has been making waves in the industry with its cutting-edge technology and strategic partnerships. The company’s shares have experienced significant volatility in recent months, with a 61% drop from January’s all-time high despite gaining 1,014% over the past six months. Rigetti designs and builds superconducting quantum processors and offers access to them through its cloud platform, Forest.
As a full-stack provider, the company develops both the quantum hardware and the software tools needed to program and operate these systems. Wall Street analysts have expressed bullish sentiments toward Rigetti Computing, citing several factors that could drive the stock’s growth. The company recently secured a significant deal with Quanta Computer Inc., a Taiwan-based global leader in computer server manufacturing.
The agreement includes Quanta purchasing RGTI shares at a premium price of $11.59 per share pending regulatory approval. Together, the companies plan to inject over $100 million into accelerating the development and commercialization of superconducting quantum computing technology over the next five years. Rigetti believes this partnership will enable both companies to harness their unique strengths to advance superconducting quantum computing technology.
Rigetti was also recently selected for the U.S. Defense Advanced Research Projects Agency’s Quantum Benchmarking Initiative (QBI), aiming to advance practical quantum computing capabilities by 2033.
Quantum partnership accelerates growth
RGTI stock has surged over 10% since this announcement.
Alliance Global Partners reiterated its Buy rating on RGTI stock, predicting an upside of over 75%. Overall, Rigetti has received a Strong Buy consensus rating, with six Buys assigned in the last three months. The average price target suggests a potential upside of 62% from the current level.
Rigetti is poised for a strong growth phase in 2025, with sales projected to rise by 36.4% and an even sharper acceleration of 153.3% in 2026. On the profitability front, EPS is expected to turn positive, with a 44.4% increase in 2025, followed by a 15% rise in 2026, indicating improved operational efficiency and better cost management. However, one significant challenge for Rigetti is its dependence on a limited supplier base for critical components.
There are fewer than 10 specialized quantum computing component manufacturers globally, with only 2-3 producing cryogenic cooling systems. This high supply concentration poses risks related to supply-chain disruptions and the bargaining power of suppliers. Despite the challenges, Rigetti stands out as a high-potential player in the quantum computing space, backed by strong momentum from collaborations and technological breakthroughs.
With a Zacks Rank of #2 (Buy), Rigetti presents an attractive investment opportunity for those seeking exposure to next-generation technologies.
Image Credits: Photo by Christian Wiediger on Unsplash
Noah Nguyen is a multi-talented developer who brings a unique perspective to his craft. Initially a creative writing professor, he turned to Dev work for the ability to work remotely. He now lives in Seattle, spending time hiking and drinking craft beer with his fiancee.
