D-Wave Quantum Shares Surge After Analyst Initiates Coverage

Key Points

D-Wave Quantum (NASDAQ: QBTS) shares rose 7.2% by 12:15 p.m. ET on Friday after BMO Capital analyst Harsh Kumar began coverage with an outperform rating.

Kumar estimates that the roughly $20 stock could reach $35 within a year.

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Why BMO loves D-Wave Quantum

Kumar describes D-Wave Quantum as a pioneering quantum computing firm that generates genuine commercial revenue and is the sole company employing both annealing and gate‑model quantum computing technologies.

Annealing targets problems with a vast solution space: qubits start in superposition, become coupled or entangled, and slowly evolve toward a low‑energy, likely correct solution. In contrast, gate‑model quantum computing operates similarly to conventional computing, with algorithms directing circuits to identify the correct answer.

Kumar says D‑Wave’s dual‑approach strategy provides a first‑mover edge in both annealing and gate‑model techniques, positioning the company strongly for commercial success in the quantum sector.

What’s next for D-Wave Quantum stock

However, investors should not anticipate rapid profitability; even projections extending to 2030 indicate that D‑Wave will likely remain unprofitable and continue to burn cash.

Revenue is projected to increase more than tenfold over the next four years, reaching approximately $444 million by 2030. While this growth reflects expanding sales, the company’s ongoing losses mean that such revenue expansion alone does not equate to true commercial success.

Personally, I would not consider purchasing the stock.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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