Rigetti Computing Sees 8.71% Surge Amid Mixed Technicals and Persistent Unprofitability

Technical Analysis

Rigetti Computing, Inc. (RGTI) closed at $8.49 on April 2, 2025, reflecting an 8.71% increase from the previous day. This surge took place within a 52-week range, hovering between a low of $0.66 and a high of $21.42, indicating significant volatility. The Relative Strength Index (RSI) of 48 suggests a neutral stance, with neither overbought nor oversold conditions. The stock is trading below its 50-day moving average of $10.50 but above its 200-day moving average of $4.94, showing a mixed trend recognition.

The MACD, at 0.20, signals a potentially bullish momentum, yet the Average True Range (ATR) of 13.05 highlights elevated volatility. Current support and resistance levels are positioned at $8.46 and $8.93, respectively, showing a narrow trading band. With a volume of 15.31 million, lower than the average of 104.60 million, the trading activity was subdued.

Fundamental Analysis

Fundamentally, Rigetti Computing struggles with a negative EPS of -1.09, reflecting continued unprofitability, and a negative PE ratio of -7.48. The market capitalization stands at $2.33 billion, positioning Rigetti as a small to mid-cap entity in its sector. Additionally, the DCF at -2.61 indicates that the intrinsic value, based on projected cash flows, is significantly below current market pricing.

Analyst sentiment shows a 'Buy' consensus grounded on five analyst ratings, even though the target price range, with a consensus of $3, is well below the current market price. The looming earnings announcement on May 8, 2025, is a critical event that could influence future stock performance.

Short-term Prediction

For the next trading day, Rigetti's price action might continue to experience volatility due to its narrow support and resistance levels. Given the current technical indicators and market sentiment, the stock could see minor fluctuations with a tendency to consolidate within its recent trading range. Over the coming week, unless new significant market-moving news occurs, there's a potential for sideways movement as the stock attempts to stabilize.

Long-term Investment Potential

Long-term, Rigetti Computing resides in the highly speculative quantum computing sector, which bears both high risks and high rewards. The introduction of the RGTX 2X leveraged ETF could attract speculative interest; however, the inherent leverage also increases risk substantially. The current cautious optimism seen in the market, combined with a low DCF, suggests the stock is trading at a premium relative to its intrinsic value projections.

Overall Evaluation

Given the current technical setup, negative fundamental metrics, and speculative industry positioning, Rigetti Computing (RGTI) can be classified as a 'Hold'. While it exhibits potential if quantum computing realizes its disruptive promise, the price volatility and current valuation risks necessitate a cautious approach for those considering exposure in the sector. The upcoming earnings announcement and further advancements in quantum technology will likely play crucial roles in defining its future valuation trajectory.