Having trouble evaluating quantum computing stocks? You're not alone.
Investors got really excited about the prospects of quantum computing start-ups like Rigetti Computing (RGTI +5.86%) and Quantum Computing (QUBT +8.39%) in 2025, and bid their stocks up to nosebleed levels. But since October, those same stock prices have plunged more than 60% from their highs.
But both stocks recently began showing signs of improvement. Which one looks likelier to make a comeback?
Image source: Getty Images.
Forget the science
For many tech companies, the best way to evaluate their prospects is to look at their products and the science behind them. Who offers the most advanced product in the space, and thus commands the highest margins? That company is the likeliest winner (this strategy has worked like gangbusters for Nvidia investors).
But for quantum computing companies, it's not that easy. Even Richard Feynman, the theoretical physicist who discovered quantum electrodynamics, famously said, "Nobody understands quantum mechanics." How can we evaluate a company's stock if literally nobody -- not even the guy who discovered it -- fully understands how the company's technology works or what it might someday be capable of?
Luckily, even if there's no way to understand the science, we can still look at the business behind it. And from that angle, Rigetti looks like it has an edge.
Image source: Getty Images.
Why Rigetti looks better
Rigetti is currently valued at $5.5 billion, well above Quantum Computing's $2 billion market cap. But it also offers a more comprehensive product than its smaller competitor, and has been much more successful at growing its revenue.
Quantum Computing is a specialist in photonics, making devices and components that utilize photons, or light particles. Photons have quantum properties, and the company has harnessed them to manufacture quantum computing components, including an "entropy quantum computer" called Dirac-3 that can solve problems related to the optimization of systems.
Ultimately, however, Quantum Computing is more of a component manufacturer -- it also makes photonic devices for medical imaging and other industries -- than a quantum computer maker.
NASDAQ: QUBT
Key Data Points
Rigetti, on the other hand, is an integrated manufacturer of quantum computers. Not only does it build all the components needed to build a quantum computer -- including quantum processing chips and control systems -- it has developed a quantum cloud services platform (QCS) to allow traditional computers to access its quantum computers via the cloud, and open-source software to create applications for them.
Essentially, Rigetti represents "one-stop shopping" for customers interested in building a quantum computer for their company or organization, or for companies looking to access quantum computing solutions without having an entire quantum computer. That proposition looks much more appealing to customers, and explains why Rigetti already has more than 10 times the annual revenue of Quantum Computing.
NASDAQ: RGTI
Key Data Points
Although both quantum stocks are speculative and seem highly priced given the risk, Rigetti looks like the better stock to buy on the dip right now.
