Looking for a Better Quantum Computing Stock Than IonQ? Wall Street Loves This One.

The sizzle has largely fizzled for IonQ (NYSE: IONQ). This once-hot stock was up nearly 90% year-to-date by early October. However, since then, IonQ's shares have plunged.

Such a steep sell-off could prompt some investors to seek a better quantum computing stock to buy. If you're in that group, Wall Street loves one alternative, in particular.

Image source: Getty Images.

A quantum computing game changer?

Microsoft (NASDAQ: MSFT) is best known for its Windows operating system, productivity software such as Excel and Word, and Xbox gaming system. But the company is also a giant in the quantum computing space.

Like the two other largest cloud providers, Amazon's (NASDAQ: AMZN) AWS and Alphabet's (NASDAQ: GOOG) (NASDAQ: GOOGL) Google Cloud, Microsoft's Azure platform offers tools to quantum computing developers. Azure also has a "Quantum Ready" program that helps organizations prepare for the impact of quantum computing on their operations.

However, the most important quantum computing development to watch with Microsoft is the company's Majorana 1 Quantum Processing Unit (QPU). Majorana 1 is the first quantum computing chip to use a topological superconductor, also known as a topoconductor. For a long time, topoconductors – a new type of matter that is neither solid, liquid, nor gas – were only theoretical. Microsoft figured out a way to make them a reality.

Topoconductors enable Microsoft to create and control qubits, the basic units of information in quantum computers. Thanks to the novel approach, the company has now achieved two major milestones on its quantum computing roadmap. It has four more to go to fulfill the goal of building a large-scale quantum supercomputer that can address real-world commercial and scientific challenges.

Microsoft believes that it will deploy practical quantum computers in years, not decades. Topoconductors just might be as much of a game-changing technology for quantum computers as silicon was for personal computers.

Wall Street's favorite

It would be an understatement to say that Wall Street loves Microsoft. I'd even argue that Microsoft is analysts' favorite quantum computing stock.

Of the 56 analysts surveyed by S&P Global (NYSE: SPGI) this month who cover Microsoft, 12 (roughly 21%) rated the stock as a "strong buy." Another 43 analysts (77%) rated it as a "buy." The lone outlier recommended holding Microsoft.

Wall Street's consensus 12-month price target for Microsoft reflects a potential upside of 28%. Several analysts are even more bullish, with one projecting the stock could soar another 49%.

Granted, Wall Street also has positive outlooks for several other quantum computing stocks. For example, six of the nine analysts surveyed recently by S&P Global rated IonQ as a "buy" or "strong buy." However, I haven't seen any leader in the quantum computing arena with more broad-based enthusiasm on Wall Street as Microsoft.

The best reason to buy Microsoft

Will Microsoft emerge as the most successful company in quantum computing on the back of its revolutionary topoconductor technology? I think it's possible, but there's no guarantee.

More importantly, it doesn't matter all that much in deciding about whether or not to invest in the stock. The best reason to buy Microsoft isn't quantum computing; it's the tech giant's tremendous opportunities in artificial intelligence (AI).

Organizations continue to scramble to develop cloud-based generative AI applications. Microsoft's fiscal 2026 first-quarter results demonstrate how the company is benefiting from this trend. Its Azure and other cloud services revenue soared 40% year-over-year.

I don't expect this growth to slow significantly. The adoption of agentic AI could even accelerate Microsoft's momentum, not just for Azure but also for the company's productivity software business as well.

Microsoft's quantum computing initiative is similar to a billionaire buying a lottery ticket. If it pays off, great. If it doesn't, no worries. That's why Microsoft is the kind of quantum computing stock that Wall Street loves.

Keith Speights has positions in Alphabet, Amazon, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, IonQ, Microsoft, and S&P Global. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.