Sign InRigetti Computing Surges 28.23% Amid Technical Volatility and Financial Challenges
Summary
On March 14, 2025, Rigetti Computing, Inc. saw its stock surge 28.23% to $11.22 amid mixed technical signals and looming financial challenges, making it a speculative investment with potential for both short-term gains and significant risks.
Technical Analysis
Rigetti Computing, Inc. (RGTI), traded on NASDAQ, closed at $11.22 on March 14, 2025, experiencing a significant daily increase of 28.23%. The stock's price range for the day was between $9.02 and $11.30, with a visible resistance level at $11.24 and support at $10.94. The current Relative Strength Index (RSI14) of 55 denotes a neutral position, indicating that the stock is neither overbought nor oversold. The 50-day moving average is above the current price at $11.56, while the 200-day moving average is significantly lower at $4.42, reflecting a substantial uptrend in the longer term.
The stock's Average True Range (ATR) is notably high at 13.06, suggesting significant volatility. The MACD for the past three months is negative, which typically indicates bearish momentum. However, the recent price jump could indicate a shift in the short-term trend. The stock may flirt with the resistance level shortly, making its immediate movement a critical watch for traders.
Fundamental Analysis
Fundamentally, Rigetti is involved in the quantum computing sector, a field gaining significant attention as evidenced by recent news. Despite its promising technology and strategic partnerships, Rigetti's financials show substantial risks. With a market cap of approximately $3.21 billion and a trailing twelve months (TTM) EPS of -$1.09, the company's P/E ratio stands at a negative figure of -10.29, indicating losses rather than profitability.
The earnings report scheduled for May 8, 2025, will be crucial in assessing Rigetti's financial health and future prospects. The company faces substantial financial challenges, including heavy R&D expenses leading to a $153 million net loss in Q4 2024.
Rigetti's intrinsic value, calculated using discounted cash flow (DCF), reflects a negative figure, suggesting overvaluation based on its financial outlook. Analyst projections provided a median target of $3, much lower than the current trading price. However, the company's ongoing projects, including its $200 million partnership with Quanta, indicate a commitment to commercializing its technology.
Long-term Investment Potential
Rigetti's long-term investment potential hinges on its ability to convert advanced quantum technology into sustainable revenue streams. The company is actively pursuing avenues through government and academic contracts, as well as enhancing quantum processing unit (QPU) deployment. While the quantum computing sector promises significant growth, Rigetti's present financial instability, highlighted by negative earnings and high burn rate, dampens its immediate appeal to risk-averse investors.
Overall Evaluation
Considering Rigetti's current technical position alongside its financial fundamentals, the stock appears to be a speculative play. The recent price spike may present an opportunity for short-term gains; however, the high volatility indicated by the ATR and the possibility of price corrections pose substantial risk.
In the context of long-term potential, the company is categorized as a 'Hold.' Investors interested in quantum computing may want to monitor Rigetti's future developments, especially its earnings update in May. However, given the current financial challenges and negative fundamental indicators, cautious optimism is suggested.
