Investors looking for the next revolutionary technology have turned their attention to quantum computing in recent times. Quantum computing works differently from classical computing as it relies on the rules of quantum mechanics. Instead of using bits to process information, quantum computers use qubits. They have the ability to scale exponentially and solve problems that are out of reach for today's classical machines.
Of course, building and operating a quantum computer isn't easy, and researchers face many challenges today, such as the fragility of qubits and the common appearance of errors. But both pure-play quantum companies and tech giants are making progress and generating impressive results. And once quantum computing reaches the stage of being generally useful, some of these players may deliver explosive growth.
With this in mind, let's check out the best quantum computing stock to own for the next five years.
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A well-established tech giant
Though pure players are exciting and offer incredible opportunity for gains, certain well-established tech powerhouses that also are exploring quantum are better suited to any portfolio. By this, I mean that such a stock could appeal to investors who don't mind risk as well as to those who are risk-averse.
This potential winner is Alphabet (GOOG 0.85%) (GOOGL 0.83%), owner of the Google platform. Google drives Alphabet's revenue through advertising -- advertisers rush to connect with us across the Google platform as we search for information and navigate the internet.
This, along with a growing cloud business -- Google Cloud -- generates billions of dollars in quarterly revenue for the company. In the most recent period, Alphabet even reached a milestone, delivering more than $100 billion in a quarter for the first time.
All of this offers investors a certain degree of safety as they can rely on these proven businesses and their ability to generate growth.
NASDAQ: GOOGL
Key Data Points
Quantum computing accomplishments
Meanwhile, Alphabet also has been investing in the area of quantum computing and has announced some exciting accomplishments. In late 2024, the company introduced its quantum chip, Willow, and said the chip has already demonstrated the ability to reduce errors exponentially as qubits scale up. This is fantastic as it addresses a key challenge in the quantum space.
And just recently, Alphabet demonstrated the ability of a quantum computer, when running an algorithm, to surpass the performance of a classical platform. The Quantum Echoes algorithm studied two molecules in a proof-of-principle experiment -- the results matched those of traditional systems, and the quantum process delivered additional information. This represents another step toward the general usefulness of this cutting-edge technology.
So, right now, with Alphabet trading for only 29x forward earnings estimates, is a fantastic time to get in on this stock and hold on for five years as the quantum story unfolds.
