D-Wave Quantum (NYSE:QBTS) Shares Down 4.1% Following Analyst Downgrade

Key Points

• D-Wave Quantum shares fell 4.1% after Canaccord Genuity cut its price target to $41 from $43, even while keeping a buy rating on the stock.
• The company’s latest earnings were mixed: it posted a smaller-than-expected loss of $0.05 per share, but revenue came in at just $2.86 million, well below estimates and down 80.9% year over year.
• Analysts remain broadly constructive on the name despite the volatility, with multiple firms reiterating bullish ratings and the consensus price target sitting at $34.67.

D-Wave Quantum Inc. (NYSE:QBTS - Get Free Report)'s share price dropped 4.1% during trading on Wednesday after Canaccord Genuity Group lowered their price target on the stock from $43.00 to $41.00. Canaccord Genuity Group currently has a buy rating on the stock. D-Wave Quantum traded as low as $20.70 and last traded at $21.4290. Approximately 25,469,446 shares were traded during trading, a decline of 14% from the average daily volume of 29,693,609 shares. The stock had previously closed at $22.35.

Other equities analysts have also recently issued reports about the company. Cantor Fitzgerald restated an "overweight" rating and set a $40.00 price objective on shares of D-Wave Quantum in a research note on Wednesday. TD Cowen started coverage on D-Wave Quantum in a research note on Thursday, February 12th. They set a "buy" rating on the stock. Weiss Ratings cut D-Wave Quantum from a "sell (d-)" rating to a "sell (e+)" rating in a research note on Wednesday, April 29th. Wall Street Zen cut D-Wave Quantum from a "hold" rating to a "sell" rating in a research note on Saturday, February 7th. Finally, Rosenblatt Securities reiterated a "buy" rating and issued a $43.00 target price on shares of D-Wave Quantum in a research note on Wednesday, January 28th. Fourteen equities research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $34.67.

Insider Buying and Selling

In other D-Wave Quantum news, VP Sophie C. Ames sold 3,070 shares of the firm's stock in a transaction on Monday, April 20th. The stock was sold at an average price of $21.35, for a total value of $65,544.50. Following the sale, the vice president directly owned 643,678 shares in the company, valued at approximately $13,742,525.30. This trade represents a 0.47% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Rohit Ghai sold 10,000 shares of the firm's stock in a transaction on Monday, March 16th. The shares were sold at an average price of $17.62, for a total value of $176,200.00. Following the transaction, the director directly owned 27,778 shares in the company, valued at $489,448.36. This trade represents a 26.47% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last ninety days, insiders have sold 31,776 shares of company stock valued at $574,571. 3.20% of the stock is owned by corporate insiders.

Key Stories Impacting D-Wave Quantum

Here are the key news stories impacting D-Wave Quantum this week:

• Positive Sentiment: D-Wave beat earnings expectations, reporting a smaller-than-expected loss of $0.05 per share versus estimates for a $0.08 loss. Earnings report and call materials
• Positive Sentiment: Bookings surged to $33.4 million, up nearly 2,000% year over year, which investors may view as a strong sign of future demand and commercialization momentum. Yahoo Finance article on bookings surge
• Positive Sentiment: Several brokerages reaffirmed bullish views after the report, including Rosenblatt, Cantor Fitzgerald, and Needham, with price targets in the $40-$43 range, signaling continued Wall Street confidence. Brokerage rating updates
• Neutral Sentiment: The company issued a quarterly share disclosure correction, which appears administrative rather than operational, so it is unlikely to be a major stock driver on its own. Share disclosure correction
• Negative Sentiment: Revenue came in at about $2.86 million, well below expectations and down roughly 81% from a year earlier, reinforcing concerns about lumpy sales and uneven near-term execution. Analyst reaction to Q1 results
• Negative Sentiment: Despite better bookings, analysts trimmed forecasts after the report, suggesting some caution remains around the pace of revenue conversion and profitability. Analyst forecast cuts

Institutional Inflows and Outflows

Large investors have recently modified their holdings of the business. Root Financial Partners LLC increased its holdings in shares of D-Wave Quantum by 388.0% during the fourth quarter. Root Financial Partners LLC now owns 976 shares of the company's stock valued at $26,000 after purchasing an additional 776 shares during the period. Parallel Advisors LLC increased its holdings in shares of D-Wave Quantum by 545.5% during the first quarter. Parallel Advisors LLC now owns 1,788 shares of the company's stock valued at $26,000 after purchasing an additional 1,511 shares during the period. Kemnay Advisory Services Inc. acquired a new position in shares of D-Wave Quantum during the fourth quarter valued at $28,000. PeakShares LLC acquired a new position in shares of D-Wave Quantum during the first quarter valued at $29,000. Finally, EverSource Wealth Advisors LLC increased its holdings in shares of D-Wave Quantum by 267.7% during the fourth quarter. EverSource Wealth Advisors LLC now owns 1,151 shares of the company's stock valued at $30,000 after purchasing an additional 838 shares during the period. 42.47% of the stock is owned by institutional investors and hedge funds.

D-Wave Quantum Price Performance

The company has a market capitalization of $7.93 billion, a price-to-earnings ratio of -19.48 and a beta of 1.95. The company has a debt-to-equity ratio of 0.04, a current ratio of 42.38 and a quick ratio of 42.25. The business has a fifty day moving average price of $17.90 and a 200 day moving average price of $22.80.

D-Wave Quantum (NYSE:QBTS - Get Free Report) last issued its quarterly earnings results on Tuesday, May 12th. The company reported ($0.05) EPS for the quarter, beating analysts' consensus estimates of ($0.08) by $0.03. D-Wave Quantum had a negative return on equity of 58.58% and a negative net margin of 1,444.10%.The company had revenue of $2.86 million for the quarter, compared to analyst estimates of $4.19 million. During the same period last year, the company earned ($0.02) earnings per share. The company's quarterly revenue was down 80.9% compared to the same quarter last year. On average, research analysts expect that D-Wave Quantum Inc. will post -0.44 earnings per share for the current fiscal year.

About D-Wave Quantum

D-Wave Quantum Inc NYSE: QBTS develops and provides quantum computing systems, software and services focused on quantum annealing technology. Headquartered in Burnaby, British Columbia, D-Wave designs specialized processors that leverage quantum mechanics to solve complex optimization and sampling problems. Since its founding in 1999 by physicists including Geordie Rose, the company has pursued the development of commercially viable quantum hardware and accompanying software tools.

The company's product portfolio centers on its quantum annealers, which are complemented by hybrid solvers that integrate classical and quantum computing resources.

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