Why IonQ, Inc. (NYSE:IONQ) Could Be Worth Watching

IonQ, Inc. (NYSE:IONQ), is not the largest company out there, but it led the NYSE gainers with a relatively large price hike in the past couple of weeks. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today I will analyse the most recent data on IonQ’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for IonQ

Is IonQ Still Cheap?

According to my valuation model, IonQ seems to be fairly priced at around 4.8% below my intrinsic value, which means if you buy IonQ today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $5.28, then there’s not much of an upside to gain from mispricing. Although, there may be an opportunity to buy in the future. This is because IonQ’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

Can we expect growth from IonQ?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. However, with a relatively muted profit growth of 0.2% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for IonQ, at least in the short term.

What This Means For You

Are you a shareholder? IONQ’s future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on IONQ, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. While conducting our analysis, we found that IonQ has 4 warning signs and it would be unwise to ignore these.

If you are no longer interested in IonQ, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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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.