A Look At Quantum Computing (QUBT) Valuation After Recent Share Price Weakness

Without a clear news catalyst, interest in Quantum Computing (QUBT) today is centering on its recent share performance, including a past 3 months total return near a 45% decline and a 1 year total return above 57%.

See our latest analysis for Quantum Computing.

At a share price of $11.69, Quantum Computing’s recent 7 day and 30 day share price returns of around 4% and 3% declines contrast with a year to date gain and a very large 3 year total shareholder return. This suggests momentum has cooled after earlier strong gains, while longer term holders still sit on substantial returns.

If QUBT’s moves have your attention, this could be a useful moment to compare it with other high growth tech and AI names using high growth tech and AI stocks.

With QUBT down sharply over 3 months but still showing strong multi year returns and a share price below the stated analyst target, the key question is whether this reflects a mispricing or a market that has already factored in expectations for future growth.

Price to Book of 3x: Is it justified?

With Quantum Computing trading at a P/B of 3x, compared with its last close at $11.69, the stock is priced above the broader US Tech P/B average and below the peer group used in its valuation checks.

The P/B ratio compares the market value of the company to its book value, which is essentially net assets on the balance sheet. For a business like Quantum Computing that is currently unprofitable and has limited revenue, investors often lean on P/B because earnings based multiples such as P/E are not meaningful.

Quantum Computing screens as expensive against the wider US Tech industry, where the average P/B is 2.4x. This suggests the market is paying a higher price relative to its net assets. However, compared with a narrower peer set where the average P/B is 5.5x, its 3x multiple looks cheaper. This points to investors assigning it a lower valuation than some similar companies despite its forecast revenue growth profile.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-book of 3x (ABOUT RIGHT)

However, you still have to weigh ongoing losses, with net income at a loss of $68.355m on just $0.546m of revenue and execution risk across multiple early stage products.

Find out about the key risks to this Quantum Computing narrative.

Build Your Own Quantum Computing Narrative

If you see the data differently or prefer to test your own assumptions, you can build a custom view of QUBT in just a few minutes with Do it your way.

A great starting point for your Quantum Computing research is our analysis highlighting 1 key reward and 4 important warning signs that could impact your investment decision.

Ready for more investment ideas beyond QUBT?

If you want to keep sharpening your watchlist, it makes sense to scan wider and see which other opportunities line up with your approach before the crowd gets there.

• Spot early stage names with potential by checking out these 3534 penny stocks with strong financials that already show stronger balance sheets and fundamentals than many of their peers.
• Target the next wave of digital growth by scanning these 25 AI penny stocks that are tied to real AI use cases rather than just headline buzz.
• Focus on price versus cash flow and see which ideas stand out in these 885 undervalued stocks based on cash flows, so you can zero in on companies the market may be overlooking.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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