D-Wave Quantum (NASDAQ:QBTS) Trading Down 4.3% - Time to Sell?

Key Points

• QBTS fell 4.3% to $16.81 on heavy trading volume, while its latest quarterly results missed expectations with $3.08 million in revenue and an adjusted loss of $0.10 per share.
• D-Wave’s growth outlook received support from a new CGI enterprise partnership, potential government funding of up to $100 million, and expanded commercial deployments.
• Risks remain significant: the company is loss-making, reportedly uses about $37 million in cash per quarter, and faces concerns about valuation, commercialization, legal investigations and insider selling. Analysts nevertheless maintain a “Moderate Buy” consensus with an average price target of $36.27.

D-Wave Quantum Inc. (NASDAQ:QBTS - Get Free Report) dropped 4.3% on Wednesday . The company traded as low as $16.75 and last traded at $16.81. 28,432,659 shares changed hands during trading, an increase of 4% from the average daily volume of 27,326,939 shares. The stock had previously closed at $17.56.

D-Wave Quantum News Summary

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

• Positive Sentiment: CGI partnership expands enterprise reach: D-Wave and IT consulting firm CGI announced a strategic partnership to develop practical quantum-computing applications for logistics, transportation, retail and other industries. The agreement could help D-Wave convert its technology into commercial optimization and decision-making use cases. CGI and D-Wave Quantum partner to advance enterprise quantum adoption
• Positive Sentiment: Government funding and new deployments support the growth narrative: Reports highlighted up to $100 million in CHIPS-related funding, production deployments and expanded commercial partnerships. These developments may improve D-Wave’s funding position and validate demand for its quantum systems and services. Here's How QBTS Deepens Quantum Push With Funding and New Deals
• Positive Sentiment: Quantum-sector momentum and board addition: D-Wave benefited from broader enthusiasm following an IonQ technology announcement. Separately, former BNP Paribas technology chief Bernard Gavgani joined D-Wave’s board and Cybersecurity Committee, potentially strengthening enterprise governance and cybersecurity expertise. Is D-Wave Quantum’s Cybersecurity Board Hire a Signal on Its Enterprise Readiness?
• Neutral Sentiment: Investors remain focused on commercialization: Analysts and commentators note that bookings and remaining performance obligations have improved, but quarterly revenue has generally remained in the approximately $2 million-to-$4 million range. The company’s ability to turn contracts and partnerships into sustained revenue remains important. D-Wave Quantum’s Revenue Hasn’t Moved in Two Years
• Negative Sentiment: Valuation and cash-burn concerns are weighing on QBTS: D-Wave remains loss-making, with analysts questioning whether its market valuation is justified by current revenue. Reports also cite roughly $37 million in quarterly cash use, while prior results missed both earnings and revenue expectations. D-Wave Quantum Just Got $100 Million From the U.S. Government
• Negative Sentiment: Legal and insider-selling overhang: Law firms are investigating potential investor claims, while reports of insider selling add to caution around the stock after its sharp multiyear run. Investor Alert: Pomerantz Law Firm Investigates Claims

Wall Street Analyst Weigh In

A number of research firms have recently issued reports on QBTS. Needham & Company LLC reaffirmed a "buy" rating and issued a $40.00 price objective on shares of D-Wave Quantum in a research report on Tuesday, June 2nd. Mizuho increased their price target on D-Wave Quantum from $29.00 to $35.00 and gave the company an "outperform" rating in a research note on Monday, June 15th. Rosenblatt Securities reaffirmed a "buy" rating and set a $43.00 price target on shares of D-Wave Quantum in a report on Friday, August 7th. B. Riley Financial lifted their price objective on shares of D-Wave Quantum from $36.00 to $40.00 and gave the stock a "buy" rating in a research report on Tuesday, June 2nd. Finally, Wedbush assumed coverage on shares of D-Wave Quantum in a report on Monday, August 3rd. They issued an "outperform" rating and a $40.00 price objective on the stock. Thirteen investment analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average target price of $36.27.

D-Wave Quantum Price Performance

The company's 50 day moving average is $18.21 and its 200 day moving average is $19.90. The firm has a market capitalization of $6.22 billion, a price-to-earnings ratio of -23.68 and a beta of 2.15. The company has a quick ratio of 20.42, a current ratio of 20.55 and a debt-to-equity ratio of 0.03.

D-Wave Quantum (NASDAQ:QBTS - Get Free Report) last released its quarterly earnings results on Thursday, August 6th. The company reported ($0.10) earnings per share for the quarter, missing analysts' consensus estimates of ($0.08) by ($0.02). The business had revenue of $3.08 million during the quarter, compared to analyst estimates of $4.03 million. D-Wave Quantum had a negative net margin of 2,001.59% and a negative return on equity of 26.67%. The firm's quarterly revenue was down 0.6 on a year-over-year basis. During the same quarter in the previous year, the firm posted ($0.08) earnings per share. On average, equities research analysts anticipate that D-Wave Quantum Inc. will post -0.46 earnings per share for the current fiscal year.

Insider Buying and Selling at D-Wave Quantum

In other news, VP Sophie Ames sold 3,070 shares of the stock in a transaction on Monday, July 20th. The stock was sold at an average price of $16.95, for a total transaction of $52,036.50. Following the sale, the vice president directly owned 589,009 shares of the company's stock, valued at approximately $9,983,702.55. This represents a 0.52% decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders own 1.30% of the company's stock.

Institutional Investors Weigh In On D-Wave Quantum

A number of large investors have recently bought and sold shares of QBTS. Tidal Investments LLC bought a new position in D-Wave Quantum during the second quarter worth $372,000. Archford Capital Strategies LLC bought a new position in shares of D-Wave Quantum in the 2nd quarter worth $200,000. WINTON GROUP Ltd bought a new stake in D-Wave Quantum during the 2nd quarter valued at $6,720,000. NorthRock Partners LLC acquired a new position in D-Wave Quantum during the second quarter worth $359,000. Finally, Integrated Wealth Concepts LLC lifted its stake in shares of D-Wave Quantum by 18.2% in the second quarter. Integrated Wealth Concepts LLC now owns 17,136 shares of the company's stock valued at $411,000 after buying an additional 2,640 shares in the last quarter. 42.47% of the stock is currently owned by institutional investors and hedge funds.

About D-Wave Quantum

D-Wave Quantum Inc develops quantum computing systems, software, and services for commercial, government, and research customers. The company is best known for its quantum annealing technology, which is designed to help solve complex optimization problems involving areas such as logistics, scheduling, manufacturing, artificial intelligence, and financial modeling.

D-Wave also develops gate-model quantum computing technology and provides access to its systems through cloud-based services, including the Leap quantum application environment.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.