D-Wave Quantum Surged Today — Is the Stock a Buy Right Now?

The stock market has been buzzing with excitement as D-Wave Quantum Inc. (NYSE: QBTS) has seen its stock price skyrocket in 2024 and early 2025. With gains exceeding 140% year-to-date and an astonishing 474.9% surge as of December 6, 2024, investors and analysts are left wondering: Is D-Wave Quantum stock a buy right now? The company, a pioneer in quantum computing, has captured attention with its impressive growth, but the high valuation and ongoing losses demand a closer look.

The Analysts Are Bullish—But Should You Be?

The recent stock surge can be largely attributed to the optimism expressed by Wall Street analysts. Both B. Riley and Canaccord have given D-Wave a thumbs-up, initiating or maintaining “buy” ratings. Canaccord, for instance, set a one-year price target of $20 per share, while B. Riley upped its target from $20 to $22. These price targets suggest significant upside potential, but they’re based on the assumption that D-Wave will continue to execute its business strategy flawlessly.

Analyst ratings can be a powerful driver of investor sentiment, especially in a cutting-edge and speculative field like quantum computing. The upgrades indicate confidence that D-Wave is well-positioned to capitalize on the growing quantum market. However, it’s important to remember that analyst predictions aren’t foolproof. They should be weighed alongside other fundamental factors, such as financial performance and market competition.

Revenue Growth and Quantum Advantage: A Double-Edged Sword

Beyond analyst hype, D-Wave’s financial performance has also fueled the stock’s momentum. The company reported a 509% revenue increase in its latest earnings, driven by a major system sale and a demonstration of “quantum advantage”—a major milestone in the industry. While the company is still operating at a loss, with a wider-than-expected loss of 8 cents per share in Q4 2024, revenue grew by 21% to $2.3 million.

The demonstration of quantum advantage is particularly noteworthy, as it proves that D-Wave’s technology can solve complex problems beyond the capabilities of classical computers. This achievement could attract more investment and partnerships, accelerating the company’s growth. However, the high trading multiples—currently at 146 times projected 2026 sales—raise concerns about profitability and valuation.

Risks and Competition: A Reality Check

Despite the positive signs, several red flags suggest caution. The stock’s valuation is exceptionally high, reflecting investor optimism that may be bordering on speculative. Trading at such a premium leaves little room for error, and a sharp correction could occur if D-Wave fails to meet expectations.

Additionally, D-Wave operates in a highly competitive and rapidly evolving industry. While it leads in quantum annealing, other companies are pursuing different quantum computing approaches, such as superconducting qubits and trapped ions, which could eventually surpass D-Wave’s technology. The Motley Fool, for example, hasn’t included D-Wave in its top stock picks, suggesting that other opportunities may offer a better risk-reward balance.

The company’s reliance on a limited customer base and the long sales cycles for complex quantum systems also pose risks. The quantum computing market is still in its infancy, and widespread adoption remains uncertain.

The Bottom Line: A High-Risk, High-Reward Play

D-Wave Quantum presents an intriguing yet highly speculative investment opportunity. The stock’s surge is justified by bullish analyst coverage, strong revenue growth, and a major technological achievement. However, the high valuation, ongoing losses, and competitive landscape warrant a cautious approach.

For investors with a high-risk tolerance and a long-term horizon, D-Wave could be a compelling bet. The potential for explosive returns exists if the company continues to innovate and secure market share. But the risks are substantial, and thorough due diligence is essential before diving in. If you’re considering adding D-Wave to your portfolio, make sure you’re prepared for the rollercoaster ride that comes with investing in a cutting-edge, high-growth stock.