D-Wave Quantum (NYSE:QBTS) Shares Gap Down Following Insider Selling

Key Points

• Insider selling: CEO Alan E. Baratz sold 806,288 shares for about $23.3 million (a 22.35% reduction in his position), and the stock gapped down—opening at $21.58 after a $23.39 close.
• Analysts are largely bullish, with multiple upgrades and higher targets (notably Cantor Fitzgerald raising its target to $40); the average price target is $28.67 and the consensus rating is "Moderate Buy" (11 Buys, 1 Hold, 1 Sell).
• Recent results showed a revenue beat—$3.74 million (+105.6% YoY) and EPS of -$0.05 versus -$0.07 expected—but the company remains unprofitable with a negative ROE/net margin and a negative PE, market cap about $8.32 billion.

D-Wave Quantum Inc. (NYSE:QBTS - Get Free Report)'s share price gapped down prior to trading on Friday following insider selling activity. The stock had previously closed at $23.39, but opened at $21.58. D-Wave Quantum shares last traded at $24.1470, with a volume of 26,279,860 shares trading hands.

Specifically, CEO Alan E. Baratz sold 806,288 shares of the stock in a transaction dated Tuesday, November 11th. The shares were sold at an average price of $28.87, for a total transaction of $23,277,534.56. Following the sale, the chief executive officer directly owned 2,801,265 shares of the company's stock, valued at $80,872,520.55. This represents a 22.35% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link.

Analyst Upgrades and Downgrades

A number of research firms have commented on QBTS. Cantor Fitzgerald increased their price objective on shares of D-Wave Quantum from $20.00 to $40.00 and gave the company an "overweight" rating in a report on Friday, November 7th. Williams Trading set a $35.00 price objective on D-Wave Quantum in a research note on Monday. B. Riley raised their target price on D-Wave Quantum from $22.00 to $33.00 and gave the stock a "buy" rating in a research note on Monday, September 22nd. Stifel Nicolaus assumed coverage on shares of D-Wave Quantum in a report on Tuesday, August 5th. They issued a "buy" rating and a $26.00 price objective for the company. Finally, Rosenblatt Securities lifted their target price on shares of D-Wave Quantum from $30.00 to $40.00 and gave the stock a "buy" rating in a research note on Friday, November 7th. Eleven research analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, the company has an average rating of "Moderate Buy" and an average price target of $28.67.

D-Wave Quantum Price Performance

The company has a debt-to-equity ratio of 0.05, a quick ratio of 54.49 and a current ratio of 54.68. The stock has a market cap of $8.32 billion, a PE ratio of -18.02 and a beta of 1.53. The stock's 50-day moving average is $29.01 and its two-hundred day moving average is $20.11.

D-Wave Quantum (NYSE:QBTS - Get Free Report) last released its earnings results on Thursday, November 6th. The company reported ($0.05) earnings per share for the quarter, beating the consensus estimate of ($0.07) by $0.02. D-Wave Quantum had a negative return on equity of 97.58% and a negative net margin of 1,651.81%.The company had revenue of $3.74 million during the quarter, compared to the consensus estimate of $3.03 million. D-Wave Quantum's quarterly revenue was up 105.6% on a year-over-year basis. On average, equities analysts predict that D-Wave Quantum Inc. will post -0.41 earnings per share for the current year.

Institutional Trading of D-Wave Quantum

A number of large investors have recently made changes to their positions in the company. IFP Advisors Inc raised its stake in D-Wave Quantum by 123.8% in the second quarter. IFP Advisors Inc now owns 14,814 shares of the company's stock valued at $217,000 after buying an additional 8,194 shares in the last quarter. World Investment Advisors acquired a new stake in shares of D-Wave Quantum during the 2nd quarter worth about $190,000. Farther Finance Advisors LLC boosted its holdings in D-Wave Quantum by 491.3% in the second quarter. Farther Finance Advisors LLC now owns 16,321 shares of the company's stock valued at $239,000 after purchasing an additional 13,561 shares in the last quarter. Allspring Global Investments Holdings LLC acquired a new stake in D-Wave Quantum during the 2nd quarter worth $217,000. Finally, SBI Securities Co. Ltd. raised its stake in D-Wave Quantum by 13.4% during the 2nd quarter. SBI Securities Co. Ltd. now owns 207,188 shares of the company's stock worth $3,033,000 after acquiring an additional 24,524 shares in the last quarter. 42.47% of the stock is currently owned by hedge funds and other institutional investors.

D-Wave Quantum Company Profile

D-Wave Quantum Inc develops and delivers quantum computing systems, software, and services worldwide. The company offers Advantage, a fifth-generation quantum computer; Ocean, a suite of open-source python tools; and Leap, a cloud-based service that provides real-time access to a live quantum computer, as well as access to Advantage, hybrid solvers, the Ocean software development kit, live code, demos, learning resources, and a vibrant developer community.

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