Recently, Rigetti Computing secured purchase orders amounting to $5.70 million for two 9-qubit Novera quantum systems. This positive news arrives alongside several Wall Street firms initiating coverage, highlighting the company’s advancements in superconducting qubit technology and its strategic position within the ecosystem.
However, the backdrop of this success is marred by Rigetti’s inability to progress in a key DARPA quantum benchmarking stage, as well as concerns regarding insider selling and cash burn. These factors reveal the ongoing tension between the technological potential Rigetti offers and the associated risks in execution.
Despite posting a modest gain over a week and a notable rebound in a single day, Rigetti’s investment narrative is complex. The recent Novera system orders provide immediate visibility and renewed attention from analysts at firms like Wedbush, Jefferies, and Mizuho. Still, they contrast sharply with the company’s small current revenue and substantial losses. Furthermore, Rigetti’s share price remains above some estimates of its fair value, indicating ongoing skepticism among some investors. The DARPA setback, coupled with insider selling, casts a shadow over the company’s governance and operational execution, even as ETF-driven flows and sector sentiment continue to fuel stock price fluctuations.
Despite the positive news surrounding the new contracts, shareholders are reminded that additional risks persist. The share prices have seen an upward trend, but whether they are reaching unsustainable levels compared to fair value remains a concern. Market evaluations vary widely; estimates of Rigetti’s fair value from the Simply Wall St Community range from $0.20 to $38, illustrating the significant disparity in investor sentiment regarding the stock’s worth.
Rigetti’s current achievements do not erase the challenges it faces, particularly in terms of performance and operational execution. As investors navigate these complexities, the recent contracts do lend some positive notes to Rigetti’s story, offering hope that the company may eventually bridge the gap between its technological capabilities and market expectations.