Why Quantum Computing Stock Keeps Going Up

Key Points

• Lake Street Capital initiated coverage of Quantum Computing stock with a buy yesterday.

• The stock is on course to close the week up 32% on the endorsement.

• 10 stocks we like better than Quantum Computing ›

Shares of eponymous quantum computing company Quantum Computing (NASDAQ: QUBT) are soaring for a fourth straight day Friday, up 22.2% through 9:55 a.m. ET and on course to end the week up closer to 32%.

You can thank the friendly analysts at Lake Street Capital Markets for that.

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What Lake Street says about Quantum Computing

In a note released yesterday -- which may not have gotten all the attention it deserved, seeing that Quantum Computing stock gained only 3.6% yesterday -- Lake Street analyst Maxwell Michaelis initiated coverage with a buy rating and a price target of $24, reports StreetInsider.com.

Although admitting that "quantum computing is still in its early stages," Michaelis calls Quantum Computing stock "a compelling way to participate in the rapidly growing market," and argues Quantum Computing Inc. has a "first-mover advantage" and "a long runway for growth."

Is Quantum Computing stock a buy?

It shouldn't take too long to figure out if Michaelis is right about that. The analyst hinges his buy recommendation on a prediction that Quantum Computing's revenue will rise dramatically in 2026 and 2027, and any such surge in revenue should be very easy to spot.

Because so far, Quantum Computing has almost no revenue at all. In all of last year, the company collected just $373,000 in revenue (yes, thousand). It's collected only $100,000 so far this year, too, so revenue right now looks set to fall by half in 2025. To me, this makes Quantum Computing stock look more like a sell than a buy, and I worry its recent stock gains are driven more by traders chasing momentum than by long-term investors.

But tune in again 12 months from now, and we'll see who was right.

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.