Rigetti Computing Stock Shows Volatility with Bullish Momentum Amid Profitability Concerns
StockInvest.us, 4 weeks ago
Technical Analysis
Rigetti Computing, Inc. (RGTI) closed at $11.24 on January 16, 2025, reflecting a 2.74% increase. The stock recently underwent significant volatility, with a notable upswing as indicated by its price range between $10.01 and $11.74. The Relative Strength Index (RSI14) of 50 suggests a neutral momentum, neither overbought nor oversold, implying stability in current trading levels. The recent volume of 252.59 million sharply exceeds the average volume of 110.69 million, indicating heightened trader interest, potentially influenced by recent market activity and news.
RGTI sits well above its 50-day and 200-day moving averages ($6.74 and $2.46 respectively), indicating a strong upward trend. The MACD value of 4.18 confirms bullish momentum. However, with the Average True Range (ATR) at 25.12, the stock demonstrates a wide range of price movement, pointing to high volatility. The key support and resistance levels are observed at $10.94 and $11.35, suggesting pivotal thresholds for potential price movement going forward.
Fundamental Analysis
RGTI's market capitalization is roughly $2.72 billion. Currently, the company is not profitable, with an EPS (TTM) of -$0.37 which renders the P/E ratio unusable (-30.38). This reflects the speculative nature of investing in Rigetti, as it is not currently generating earnings. The recent news highlights wild market reactions, with shares surging after significant losses. Despite bearish commentary, Wall Street consensus aligns toward a 'buy,' although there remains a spectrum of opinion on the stock.
The discounted cash flow (DCF) model presents a negative outlook with a projected value of -$7.44, emphasizing concerns over the company's long-term cash generation capabilities. This inadequacy in intrinsic valuation reinforces skepticism about the stock's affordability despite current upward momentum.
Short-Term Predictions
Based on current technical indicators, Rigetti may experience continued volatility in the next trading day. With support and resistance levels close to the current price, traders should remain vigilant for breakout scenarios. Over the upcoming week, market sentiment fostered by speculative interest and media influence could continue to drive stock price fluctuations.
Long-Term Investment Potential
The long-term potential for Rigetti depends heavily on the growth of quantum computing and the company's ability to capture market share and achieve profitability. As a leader in a nascent industry, investor interest in RGTI is subject to technological advancements and competitive positioning. While current metrics reflect a speculative play, successful execution in quantum computing could render significant returns over the long haul. Nevertheless, investors should remain cautious about the extended timeline and inherent risks.
Overall Evaluation
At present, RGTI is a 'Hold' candidate. The stock faces high volatility and significant intrinsic challenges, yet it exhibits bullish technical momentum. Potential investors may consider maintaining existing positions, while closely observing market developments and upcoming earnings for more clarity on the company's financial trajectory.