There’s an old saying: fortune favors the bold. Are you ready to take a chance on quantum-computing specialist IonQ (NYSE:IONQ) stock? You’ll get no guarantees whatsoever, but a reasonably sized stake in IONQ stock could be your ticket to a 100% return on your investment.
IonQ is a pioneer in the future of artificial intelligence. IonQ’s revenue growth shows a positive outlook for the quantum-computing market. Just be aware that IonQ’s financial’s aren’t perfect and, as usual, the potential for a share-price double comes with substantial risk.
IONQ Stock’s Fate Depends on the Industry’s Growth
IonQ is what I would call an unrecognized innovator. In early 2024, people aren’t buzzing about quantum computing because they’re so heavily focused on generative AI. So, Wall Street is putting IonQ on the back burner.
The market is fickle, though. Investors bid IONQ stock up to $20 late last year. More recently, however, the stock fell below $10. It’s as if short-term traders can’t make up their minds about quantum computing and IonQ.
Yet, if you’re going to bet your hard-earned capital on the quantum-computing industry, you’d might as well invest in IonQ. This is the company that opened the first dedicated quantum-computing manufacturing facility in the U.S.
IonQ is forming partnerships to advance quantum-computing technology in South Carolina and South Korea and, separately, in the airline industry. IonQ is an early and aggressive mover in a field with “next AI” hypergrowth potential.
Good News and Bad News About IonQ’s Financials
It’s not unusual for a leader in a burgeoning industry to have less-than-perfect financials. Even if the company has robust revenue growth, research and development is costly and it can take years to turn a profit.
Thus, it shouldn’t be too surprising to learn that IonQ isn’t profitable yet. The good news is that IonQ’s fourth-quarter 2023 revenue increased 60% to $6.106 million, versus $3.807 million in the year-earlier quarter.
The bad news is that IonQ’s total operating costs and expenses more than doubled during that time frame.
IonQ incurred a Q4 2023 net earnings loss of $41.904 million, which is much deeper than the company’s $18.674 million net loss from the year-earlier quarter.
Of course, I’m not jumping to the conclusion that IonQ is a “zombie” company.
I’m only saying that, in theory, IonQ could run out of money eventually if the quantum-computing market fails to grow in the coming years.
IONQ Stock: You’ll Either Get a Double or Get in Trouble
I won’t beat around the bush with this one. Investing in IonQ will either make you a hero or get you a big zero. It depends on whether quantum computing is really all it’s cracked up to be.
At the end of the day, I think it makes sense to take a small share position in IONQ stock.
You’ll regret it someday if the quantum-computing market explodes and you didn’t invest in IonQ when you had the chance. So, go ahead and pick up a few IonQ shares near $10 with an eventual price target of $20 or more.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.