Wall Street's Biggest Bubble Stocks Are Bouncing Back (and I'm Not Talking About AI) -- Don't Take the Bait

For more than three years, arguably no trend has excited investors quite like the rise of artificial intelligence (AI). But AI isn't the only game-changing technology that offers an eye-popping addressable opportunity.

Since late 2024, investors have flocked to quantum computing stocks, including IonQ (NYSE: IONQ), Rigetti Computing (NASDAQ: RGTI), D-Wave Quantum (NYSE: QBTS), and Quantum Computing Inc. (NASDAQ: QUBT). As of mid-October 2025, trailing 12-month returns for this quarter were as high as 6,217% -- and these stocks are on fire, once again.

Image source: Getty Images.

As of the closing bell on April 15, IonQ, Rigetti, D-Wave, and Quantum Computing had rallied 45%, 26%, 42%, and 29% over the last two trading sessions. Though it would appear that one of Wall Street's hottest trends is bouncing back in a big way, investors would be wise not to take the bait.

Quantum computing stocks are flying yet again

Quantum computing, which uses specialized computers to solve complex equations in a fraction of the time it takes classical computers, offers a sky-high addressable market. Boston Consulting Group analysts foresee this technology creating up to $850 billion in global economic value by 2040.

It's also a technology with intriguing real-world use cases. It can be used to expedite the training of AI-driven large language models and run molecular interaction simulations to improve clinical trial success rates, among other tasks.

Quantum computing is the subject of potential hefty investments, as well. In October, JPMorgan Chase launched its $1.5 trillion Security and Resiliency Initiative, naming quantum computing as one of 27 sub-areas that may see investments or financing.

But the catalyst responsible for sending IonQ, Rigetti, D-Wave, and Quantum Computing soaring this week was AI titan Nvidia hosting a Quantum Day on April 14. Nvidia shedding light on quantum computing tasks and AI integration puts these stocks back in the spotlight.

Image source: Getty Images.

Quantum computing remains Wall Street's biggest bubble

While the fear-of-missing-out (FOMO) is likely tugging on investors' heartstrings following two-day gains of 26% to 45%, quantum computing stocks remain rife with red flags.

To begin with, every game-changing trend since the advent of the internet has navigated its way through an early stage bubble-bursting event. These bubbles form because investors overestimate how quickly an innovation will be adopted and/or optimized. In the case of quantum computing, it's still very early in its adoption stage and nowhere close to optimizing sales and profits for businesses. Both hallmarks of a bubble are present.

To build on this point, the valuations of quantum computing stocks make little sense. History shows that price-to-sales (P/S) ratios above 30 for companies on the leading edge of next-big-thing trends have proved unsustainable. Over the trailing 12-months, IonQ, Rigetti Computing, D-Wave Quantum, and Quantum Computing Inc. have P/S ratios of 95, 846, 272, and 2,333, respectively.

IONQ PS Ratio data by YCharts.

Rounding things out, the barrier to entry for pure-play quantum computing stocks may be considerably smaller than investors realize. Several members of the "Magnificent Seven" have developed quantum processing units and have much deeper pockets than pure-play quantum computing companies. It's not out of the question that IonQ, Rigetti, D-Wave, and Quantum Computing cede their first-mover advantages entirely in the coming years.

Though quantum computing FOMO may be tempting, don't take the bait.

JPMorgan Chase is an advertising partner of Motley Fool Money. Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends IonQ, JPMorgan Chase, and Nvidia. The Motley Fool has a disclosure policy.