D-Wave Quantum Skyrocketed Today. Is the Stock a Buy?
D-Wave Quantum's stock surged 13.7% amid a generally positive market, despite a lack of specific business news. The rise is attributed to broader industry optimism, including Denmark's plans for a powerful quantum computer and expectations of Federal Reserve interest rate cuts. While investing in D-Wave carries risks due to market speculation, its specialized position in quantum computing may offer significant valuation gains if its technology proves effective. Investors focused on quantum computing may find D-Wave a compelling addition to their portfolios.
D-Wave Quantum (QBTS 13.75%) stock recorded another day of explosive gains in Thursday's trading. The quantum-computing company's share price climbed 13.7% in the daily session amid the backdrop of a 0.5% gain for the S&P 500 and a 0.7% gain for the Nasdaq Composite. The stock had been up as much as 15.5% earlier in trading.
D-Wave Quantum stock continued to surge higher despite little in the way of business-specific news for the company. News that Denmark has aspirations to host the world's most powerful quantum computer pointed to the potential for a big increase in state-level support for the industry, but it was otherwise a relatively slow news day for quantum stocks. That didn't stop companies in the space from seeing big valuation gains, and expectations that the Federal Reserve will issue multiple interest rate cuts helped support share price expansions.
Image source: Getty Images.
Is D-Wave Quantum stock a buy right now?
Charting the progression of the quantum computing space involves an incredibly high degree of guesswork. Even if it's taken as a baseline assumption that the tech category will continue to see major breakthroughs that pave the way for much wider commercial adoption, determining which companies in the space will wind up being winners involves a huge amount of speculation.
D-Wave is staking a specialized, forefront position in the category and could go on to see massive valuation gains if its quantum-computing machines deliver on their promise and prove to have substantial real-world applications. The company launched its Advantage2 system in May, and its next quarterly report should provide some insight into what demand looks like for the machines. While D-Wave stock looks risky on the heels of its recent valuation run up, it could be a worthwhile portfolio addition for investors who are making exposure to the quantum computing space a key strategic priority.
