Shares of D-Wave Quantum (QBTS 15.66%) are jumping on Wednesday, up 10.5% as of 2:50 p.m. ET. The rise comes as the S&P 500 and Nasdaq Composite gained 0.7% and 0.5%, respectively.
D-Wave, a company developing quantum computing technology, is riding momentum in the broader quantum market as its stock receives a price target upgrade from a Wall Street analyst.
This analyst is bullish
An analyst at the investment bank B. Riley Financial increased their price target for shares of D-Wave while maintaining a buy rating. The analyst increased the target price from $20 to $22 and signaled their confidence in its potential.
This comes as the quantum industry sees an enormous amount of interest and momentum. D-Wave's stock is up nearly 1,700% in the last year alone.
Investors should be cautious
While there has been an increase in visibility for D-Wave in the last year, not enough has materially changed in my eyes to justify such an enormous run-up. The company's current market capitalization of over $6 billion stands in stark contrast to its 2024 revenue of less than $9 million.
Image source: Getty Images.
Despite the hype around quantum, I think there is plenty of reason to believe this technology is a very long way from maturing and being capable of driving revenue of any significance.
If you're an investor with a particularly high risk tolerance and the ability to possibly wait a decade for your investment to pay off, you could consider investing now. I'll personally wait until valuations come back to earth. If you do, however, I would strongly suggest spreading your investment around many quantum stocks; there's no way to tell at this point which company's approach will work in the long run.
