An analyst suggests that the quantum computing market could reach $205 billion within a decade, recommending investors willing to overlook "volatile" revenue to consider stocks like IonQ, Rigetti, and D-Wave.
D-Wave is among the quantum companies Mizuho recommends for investors seeking exposure to emerging trends in computing. NVIDIA’s stock has surged nearly 22,000% over the past decade and 46,000% in the last 15 years, making it understandable why investors are eager to identify other transformative stocks early on.
However, pinpointing such stocks is easier said than done. Mizuho analyst Vijay Rakesh highlights quantum computing as an "exponential opportunity" and recommends several stocks aligned with this trend for investors searching for the next NVIDIA.
That said, the broad promise of large-scale quantum computing remains years away, and with the technology still largely in the R&D phase, near-term revenue opportunities are "likely volatile."
Rakesh initiated coverage on IonQ, Rigetti Computing (RGTI), and D-Wave Quantum (QBTS) with "Outperform" ratings in a Thursday report, calling quantum computing the "next major computing revolution."
D-Wave and Rigetti have surged over 2,000% in the past two years, while IonQ has gained about 240%. These moves have been largely driven by hype and momentum rather than immediate financial potential.
Rakesh estimates combined 2024 revenue for IonQ, Rigetti, and D-Wave at just $140 million. Meanwhile, D-Wave and Rigetti boast market caps exceeding $8 billion, while IonQ’s valuation surpasses $17 billion.
Historically, major computing paradigms have seen explosive growth a decade after the industry hits $1–2 billion in annual revenue. Rakesh projects the quantum computing market could reach $205 billion in 10 years.
By 2030, he expects these companies to collectively generate around $5 billion in revenue, capturing 36% of his estimated $15 billion total addressable quantum market. By 2040, quantum firms could account for 16% of the broader computing market.
While quantum research spans decades, Rakesh notes the industry is now scaling toward 1,000+ error-corrected logical qubits—a milestone he believes will accelerate applications. Unlike classical computing’s binary 0s and 1s, qubits enable simultaneous calculations but require error correction to maintain their fragile quantum states.
Rakesh’s $90 price target for IonQ implies 74% upside from Wednesday’s close of $51.67. He views IonQ as a "leader" due to its trapped-ion approach’s lower error rates and longer coherence times, which help sustain quantum states. This could give IonQ an edge in commercial adoption. The company offers full-stack solutions, including networking and sensing, and may eventually capture ~16% of the quantum market.
His $50 target for Rigetti suggests 91% upside from $26.12. Rigetti’s path to scaling hinges on meeting qubit targets by 2025 and 2027 while achieving 99.8% two-qubit gate fidelity—a measure of operational accuracy. With over $450 million in liquidity, Rigetti is positioned to operate through at least 2030. Its superconducting method aligns it with peers like IBM and Google, potentially securing 10% market share long-term.
For D-Wave, his $46 target reflects ~71% upside from $26.80. D-Wave dominates quantum annealing—a technique focused on optimization by finding quantum systems’ lowest energy states—and could hold 10% market share.
Quantum computing "promises a major shift in high-performance computing," Rakesh says, following general-purpose (CPU) and parallel (GPU) computing. The technology could deliver performance gains "10,000x+" beyond classical methods, solving problems in cryptography and machine learning that today’s computers cannot.
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