Why Rigetting Computing Stock Just Popped
Key Points
D-Wave Quantum announced today that AT&T will use its annealing quantum computing technology.
Meanwhile, Benchmark analyst David Williams just initiated coverage of Rigetti stock with a buy rating.
Quantum computing stocks look hot today, but profits remain years away.
- 10 stocks we like better than Rigetti Computing ›
Quantum computing stock Rigetti Computing (NASDAQ: RGTI) jumped a lucky 7.7% through 11:50 a.m. ET Monday morning -- and in part, it's got a competitor to thank for it.
This morning, rival quantum stock D-Wave Quantum (NYSE: QBTS) announced that AT&T (NYSE: T) will use D-Wave's technology "to address complex optimization challenges across its network operations."
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Why AT&T loves quantum computing
AT&T will use D-Wave's "annealing quantum computing technology" to find optimal solutions to complex mathematical problems, aiming to make AT&T's AI agents more efficient when optimizing data traffic and detecting network outages. AT&T is also evaluating other quantum computing technologies to improve its network, which may signal openness to using Rigetti's quantum systems as well.
And that's not the only good news at Rigetti today. As StreetInsider reports, Benchmark analyst David Williams just initiated coverage of Rigetti stock with a buy rating and a $25 price target, indicating he sees potential for Rigetti to gain another 67% on top of the 7% it has already gained today!
Why Benchmark loves Rigetti Computing
D-Wave's reaping the good news today, but Williams reminds that "quantum computing ... is NOT a 'winner-takes-all' situation." Different approaches to quantum could offer different advantages, and various approaches might work together complementarily to increase overall effectiveness.
At this early stage, it's hard to tell how everything will play out. Thus, the analyst recommends taking a "portfolio approach to investing in the sector" -- buying a little of all the quantum stocks so as not to miss out entirely on any winners.
That seems good advice. Most analysts agree that most quantum computing companies remain five or more years away from profitability. Rigetti might end up as one of the winners. Betting on the stock to rocket 67% in a year is probably overoptimistic.
Should you buy stock in Rigetti Computing right now?
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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.
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