Rigetti Computing Faces Volatility as Stock Pulls Back Despite Long-Term Growth Potential

Technical Analysis

Rigetti Computing (RGTI) closed at $10.89 on June 5, 2025, down 7.87% from the previous session, trading within an intraday range of $10.71 to $11.81. The 14-day RSI at 46 indicates neutral momentum, slightly toward the bearish side but not oversold. The stock price remains above both the 50-day ($10.09) and 200-day ($7.00) moving averages, suggesting an overall bullish trend in the medium to long-term timeframe despite the recent pullback. MACD at 1.42 supports positive momentum, although the sizable average true range (ATR) of $10.88 implies elevated volatility. Trading volume at 34.87 million is below the 50.29 million average, indicating reduced participation in the recent decline.

Support is identified near $9.87, with resistance at $11.22, a key level to watch for a breakout that could signal a recovery move in the short term. A stop-loss near $10.34 may serve as a tactical protection point given recent volatility. Technical indicators suggest the potential for a short-term bounce or consolidation around current levels but heightened volatility is expected.

Fundamental Analysis

The company reports a trailing twelve months EPS of -$0.80 and a negative PE ratio of -13.61, consistent with its status as a pre-profit quantum computing start-up. The discounted cash flow (DCF) valuation is negative at -2.40, indicating the current intrinsic value is theoretically below zero based on traditional cash flow methodology, reflective of negative free cash flow and capital-intensive operations. Market capitalization stands at approximately $3.18 billion, reflecting robust investor interest in quantum technology despite ongoing losses.

Recent strategic developments, including a $35 million deal with Quanta to advance quantum computing scalability toward commercial deployment, highlight progress toward revenue generation and potential market penetration. The company’s stock has surged over 1,000% in the past year, driven by growing excitement around quantum computing’s transformative potential, although these gains have made shares increasingly volatile and sensitive to profit-taking.

Analyst consensus offers a bullish tilt with 3 buys and 1 hold, target price consensus stabilizing at $3, which appears outdated given the current stock price of nearly $11. The divergence suggests current market valuation is supported more by speculative momentum than fundamental ratios.

Earnings are due August 6, 2025; the report may provide clarity on commercialization progress and cash burn, influencing near-term price action.

Short-Term and Weekly Outlook

For June 6, 2025, RGTI’s technical configuration suggests the stock may attempt to stabilize near support at ~$9.87-$10.34. Given the oversold conditions from the previous day’s heavy decline, an intraday rebound or sideways consolidation is plausible to restore some technical balance. Resistance at $11.22 remains a critical barrier for any sustained recovery.

Over the coming week, the stock’s performance will likely hinge on sentiment and news flow around strategic partnerships and technological milestones. The volatility environment coupled with a still-developing business model means price swings are expected as investors reassess risk-reward dynamics.

Intrinsic Value and Long-Term Potential

From a fundamental perspective, Rigetti’s negative DCF and EPS underscore the challenges inherent in early-stage quantum computing firms: significant R&D investment and uncertain near-term profitability. However, the company's movement toward commercial viability, evidenced by recent contracts, positions it strategically for future growth as industry adoption of quantum solutions accelerates.

Intrinsic value at this stage remains difficult to quantify with precision, as long-term success hinges on technology breakthroughs and scalable revenue models. The current market capitalization reflects a premium for innovation potential rather than earnings or stable cash flow. Hence, long-term investors should view RGTI as a high-risk, high-reward speculative growth name with exposure to transformative technological progress.

Overall Evaluation

RGTI’s technical base is moderately supportive but volatile; its fundamentals reveal early-stage losses offset by strategic opportunity in an emerging sector. Market enthusiasm has driven the stock to elevated levels, resulting in heightened short-term risk.

Characterizing the stock: it is positioned as a Hold. The valuation premium limits immediate bullish conviction, and near-term volatility suggests caution. Positive momentum and technological advances maintain upside potential, but downside risks remain pronounced due to unproven profitability and macro uncertainties. Investors with tolerance for speculative technology exposure may track developments closely, while others might await clearer fundamental inflection points before increasing exposure.