By Mackenzie Tatananni
Quantum computing has emerged as the hot new technology on Wall Street, and for good reason: Supporters say it could usher in a technological revolution. While behemoths like International Business Machines and Alphabet-owned Google have been making moves, the smaller, more aspirational quantum pure plays present a different way to gain exposure to the emerging technology.
In a research note Thursday, Mizuho Securities analysts initiated coverage on shares of IonQ, Rigetti Computing, and D-Wave Quantum at Outperform, with price targets of $90, $50, and $46, respectively. IonQ rose 1.3% to $52.35 in premarket trading while Rigetti ticked 0.5% higher to $26.25 and D-Wave gained 0.8% to $27.01.
Following in the steps of today's classical processors, quantum computing "promises a major transformation in high-performance computing tasks," the firm asserted. We've heard this argument before: Mature quantum computers could lead to a paradigm shift, offering speed-ups in areas such as drug discovery and financial modeling. While the firm sees inconsistent revenue in the near term, it expects an acceleration beginning in 2035, with the total addressable market for quantum computing swelling to $205 billion by the end of the next decade from $1 billion this year.
Founded in 2015, IonQ may be the new kid on the block, but it has quickly set to work landing contracts and building relationships with potential customers. Analysts highlighted the growing adoption of IonQ's services by commercial clients, federal agencies, and cloud platforms offered by Amazon.com and Microsoft. In fact, "IonQ is the most prominent source of quantum computing capacity across cloud selling to AWS, Azure, and Google Cloud," Mizuho noted.
Rigetti, meanwhile, has been deploying quantum computers to end users over the cloud since 2017, four years after its founding. In 2023, the company began sales of full systems, and had deployed 18 different systems as of the end of September. Analysts called attention to Rigetti's technical prowess, noting that the company is targeting 1,000-qubit system by the end of 2027 with 99.8% two-qubit gate fidelity, which would place it among the ranks of "market leaders" Google and IBM.
D-Wave may have first-mover advantage out of all the pure plays as the first company to commercialize the quantum computer, with the sale of the D-Wave One to Lockheed Martin in 2011. The company's vast portfolio of intellectual property, boasting over 220 U.S. patents, helps establish the company as a "recognized pioneer in applied quantum computing," Mizuho analysts wrote. D-Wave has started to ship its second-generation system, the Advantage2, while providing access to compute power over the cloud through its Leap platform.
Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
By Mackenzie Tatananni
Quantum computing has emerged as a hot new item on Wall Street, and for good reason: Supporters say it could usher in a technological revolution. While behemoths like International Business Machines and Alphabet-owned Google have been making moves, the smaller, more aspirational quantum pure plays present a different way to gain exposure to the emerging technology.
In a research note Thursday, Mizuho Securities analysts initiated coverage on shares of IonQ, Rigetti Computing, and D-Wave Quantum at Outperform, with price targets of $90, $50, and $46, respectively.
The stocks, however, declined, following a slump in the broader tech sector. After rising in premarket trading, IonQ fell 4.5% to $49.3, Rigetti fell 3.7% to $25.15, and D-Wave slipped 1.8% to $26.31.
Following in the steps of today's classical processors, quantum computing "promises a major transformation in high-performance computing tasks," Mizuho asserted.
We've heard this argument before, that mature quantum computers could lead to a paradigm shift, offering speed-ups in areas such as drug discovery and financial modeling. Quantum systems are expected to work alongside today's classical machines, rather than outright replace them, to make data-intensive processes more efficient.
While Mizuho sees inconsistent revenue in the near term, the firm expects an acceleration beginning in 2035, with the total addressable market for quantum computing swelling to $205 billion by the end of the next decade from $1 billion this year.
Founded in 2015, IonQ may be the new kid on the block, but it has quickly set to work landing contracts and building relationships with potential customers. On Monday, the company announced the deployment of a hybrid quantum-classical network in conjunction with a research institution in Slovakia.
Analysts highlighted the growing adoption of IonQ's services by commercial clients, federal agencies, and cloud platforms offered by Amazon.com and Microsoft. In fact, "IonQ is the most prominent source of quantum computing capacity across cloud selling to AWS, Azure, and Google Cloud," Mizuho noted.
Rigetti, meanwhile, has been deploying quantum computers to end users over the cloud since 2017, four years after its founding. In 2023, the company began sales of full systems, and had deployed 18 different systems as of the end of September.
Analysts called attention to Rigetti's technical prowess, noting that the company is targeting 1,000-qubit system by the end of 2027 with 99.8% two-qubit gate fidelity, which would place it among the ranks of "market leaders" Google and IBM.
D-Wave may have first-mover advantage out of all the pure plays as the first company to commercialize the quantum computer, with the sale of the D-Wave One to Lockheed Martin in 2011. D-Wave has started to ship its second-generation system, the Advantage2, while providing access to compute power over the cloud through its Leap platform.
The company's vast portfolio of intellectual property, boasting over 220 U.S. patents, helps establish the company as a "recognized pioneer in applied quantum computing," Mizuho analysts wrote.
It's important to remember these are long-term investments, rather than opportunities to quickly turn a profit. Mizuho emphasized that quantum remains in research and development for now, with years to go before the industry reaches a so-called inflection point.
Several obstacles must be cleared before then, namely scaling to larger systems without increasing the incidence of errors. As more quantum bits, the basic units of information in a quantum system, typically correlate to more errors, this presents a significant technical hurdle.
For now, analysts expect revenue growth to remain lumpy through 2027, driven by funding from government research labs and universities as well as the Defense Advanced Research Project Agency's Quantum Benchmarking Initiative.
Both Rigetti and IonQ were tapped to join the initiative earlier this year, which provides funding along with each progressive round of concept and research validation. As of Nov. 5, only IonQ had been selected to progress to Stage B, along with other players like IBM and Honeywell-owned Quantinuum.
While the technology may need time to reach full potential, quantum computing is "primed to drive the next compute revolution," the Mizuho team wrote. Investors should pay attention.
Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
December 11, 2025 10:59 ET (15:59 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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