2 Unstoppable Quantum Computing Stocks to Buy Hand Over Fist Before the Next Rally

Quantum computing is moving closer to mainstream adoption, creating exciting opportunities for investors. With that, IonQ (NYSE: IONQ) and Rigetti Computing (NASDAQ: RGTI) are two promising companies making strides in quantum computing. And looking ahead, if adoption accelerates, both stocks could be well-positioned for the next major rally.

Image source: Getty Images.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

Let's start by looking at what IonQ is building.

How IonQ's end-to-end quantum platform could benefit from adoption

IonQ is building a comprehensive platform that spans quantum computers, networking, and cybersecurity. That broader strategy could give it several ways to benefit as quantum technology moves closer to commercial adoption.

One of IonQ's biggest advantages is its trapped-ion approach, which is said to deliver highly accurate quantum operations. That matters because the company is working to develop more powerful and reliable quantum computers, thereby enhancing the performance and scalability of its systems.

The company's recent technical milestones are also encouraging.

IonQ demonstrated the industry's first end-to-end real-time quantum error decoder, which could make larger quantum systems more reliable. The company also demonstrated a quantum memory-enhanced interconnect, which is an important step toward connecting separate quantum processors.

IonQ is also strengthening its manufacturing capabilities. As an example, it completed its acquisition of SkyWater Technology, a U.S.-based semiconductor foundry. This gives the company greater control over the hardware manufacturing process, helping it improve production, develop specialized chips, and scale its technology more efficiently.

The commercial opportunity is also gaining traction. IonQ reported strong revenue growth in its second quarter, supported by demand across its broader quantum platform. In fact, revenue climbed 287% year over year in a record quarter.

On top of that, its partnerships with organizations like Nvidia, Sandia National Laboratories, and Anduril highlight its role in other industries, including artificial intelligence (AI), scientific research, and national security.

But of course, IonQ remains a speculative investment at this stage, as quantum computing has yet to achieve widespread commercial adoption. The company also faces many technical and execution challenges before it can become profitable. Valuation is also a concern, with the stock trading at about 42 times its price-to-sales (P/S) ratio.

Aside from IonQ, another company is taking a different approach to scaling quantum systems.

Rigetti's chiplet design could offer a practical path to scaling quantum systems

Unlike IonQ, Rigetti uses superconducting qubits, which run using electrical circuits cooled to extremely low temperatures. One of the biggest advantages of this approach is its fast gate speeds, which allow quantum operations to run much faster. The company believes its technology can provide a practical path toward building more powerful quantum systems.

Its chiplet strategy is also a key advantage. Instead of relying on a single massive chip, Rigetti combines smaller processor units into a larger system, and the company has already demonstrated this approach with its Cepheus-1-108Q system.

Meanwhile, Rigetti has also been fulfilling orders for on-premises quantum systems, including its Novera-based machines and the 108-qubit system program for India's Center for Development of Advanced Computing. These deployments matter because they give universities and research institutions direct access to quantum hardware.

And the initiatives seem to be working. Rigetti's second-quarter revenue, for example, grew 185% year over year, though from a small base, all while Rigetti works to build a more commercially scalable business.

More recently, however, Rigetti established a dedicated systems delivery organization and appointed new leadership to oversee operations and technology development.

Still, the company faces meaningful risks in its operations. Rigetti remains an early-stage business with limited commercial revenue, significant operating losses, and a long development path. The stock also trades at about 278 times its P/S ratio, so if future growth doesn't exceed investor expectations, Rigetti could see steep losses.

But despite the risks, can IonQ and Rigetti still deliver massive upside?

Which quantum stock fits which type of investor?

IonQ and Rigetti offer two ways to invest in the quantum computing race.

With an expanding technology stack and growing commercial adoption, both companies could be poised for the industry's next growth phase. If they execute on their roadmaps and benefit from accelerating demand, their stocks could still have plenty of upside.

IonQ looks like the more conservative of the two, with a broader platform and lower valuation. Rigetti is the higher-risk, higher-reward pick, given its early stage and steep valuation.

Rick Orford has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hewlett Packard Enterprise, IonQ, and Nvidia. The Motley Fool has a disclosure policy.