D-Wave Quantum
QBTS
$16.82
+2.00%
D-Wave Quantum Inc. is a pioneer in the development and delivery of quantum computing systems, software, and services, and it is the only company building both annealing quantum computers and gate-model quantum computers. As a commercial supplier of quantum computers, it holds a distinct competitive position in the emerging quantum computing industry, offering practical applications across logistics, AI, materials sciences, and drug discovery. The current investor narrative revolves around the company's potential to capitalize on the rapidly evolving quantum computing market, driven by recent government funding catalysts and strategic partnerships, while also facing intense scrutiny over its high valuation and the long timeline to commercial viability. The stock has experienced significant volatility, with a 1-year price change of +6.72% but a 3-month decline of -43.63%, reflecting both speculative enthusiasm and concerns about the company's fundamental performance.…
QBTS
D-Wave Quantum
$16.82
Related headlines
Investment Opinion: Should I buy QBTS Today?
Based on the data, I rate QBTS a Hold. The stock is a high-risk, high-reward speculative investment with a strong analyst consensus (Strong Buy, average target $35.24) but an extreme valuation that prices in perfection. The thesis is that D-Wave's unique position in quantum computing and recent catalysts could drive long-term growth, but the current price already reflects much of this optimism.
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QBTS 12-Month Price Forecast
The AI assessment is neutral with medium confidence. The extreme valuation and negative revenue growth are concerning, but the bookings surge and analyst optimism suggest potential upside. The stock is a high-risk, high-reward play, and the stance would upgrade to bullish if revenue growth turns positive and the PS ratio compresses below 200. Conversely, a downgrade to bearish would occur if the company announces a dilutive offering or misses revenue estimates.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on D-Wave Quantum's 12-month outlook, with a consensus price target around $35.24 and implied upside of +109.5% versus the current price.
Average Target
$35.24
0 analysts
Implied Upside
+109.5%
vs. current price
Analyst Count
—
covering this stock
Price Range
$22 - $43
Analyst target range
D-Wave Quantum is covered by 16 analysts, with a consensus recommendation of 'strong buy' and a mean recommendation score of 1.18 (where 1 is strong buy and 5 is sell). The average target price is $35.24, which implies an upside of 107.4% from the current price of $16.99, indicating that analysts are highly bullish on the stock's long-term prospects. The target price range spans from a low of $22.00 to a high of $43.00, with the low target still representing a 29.5% upside, suggesting that even the most bearish analyst sees value in the stock. The high target of $43.00 implies a potential gain of 153.1%, reflecting expectations of significant growth driven by quantum computing adoption and government funding. Recent institutional ratings show a series of 'Buy' and 'Outperform' actions from firms like Mizuho, Rosenblatt, and Needham, with no downgrades, indicating a consistently positive sentiment. However, the wide spread between the low and high targets (a 95.5% difference) highlights the high uncertainty surrounding the company's future, as the quantum computing market is still nascent and the path to profitability is unclear.
Bulls vs Bears: QBTS Investment Factors
D-Wave Quantum presents a stark contrast between strong analyst sentiment and extreme valuation. The bull case rests on a strong buy consensus, surging bookings, and government support, while the bear case is anchored by a 341.6 PS ratio, declining revenue, and insider selling. Currently, the bearish evidence is stronger because the valuation implies perfection, and any disappointment could trigger severe multiple compression. The most critical tension is whether the 1,100% bookings surge can translate into sustained revenue growth, as the entire bull thesis depends on it. If revenue accelerates, the stock could re-rate higher; if not, the high PS ratio will likely contract, leading to further downside.
Bullish
- Strong Buy Consensus with 107% Upside: 16 analysts rate QBTS a Strong Buy (mean score 1.18), with an average target of $35.24, implying 107.4% upside from $16.99. Even the lowest target of $22.00 offers 29.5% upside, indicating broad analyst conviction in the company's long-term prospects.
- Bookings Surge 1,100% Signals Demand: Despite a 44% revenue decline, bookings surged 1,100% year-over-year, suggesting that the revenue drop is a timing issue and that future revenue recognition could accelerate. This indicates strong customer traction for D-Wave's quantum solutions.
- Government Funding Catalyst: A $100 million government funding catalyst and a $2 billion federal quantum computing initiative provide near-term financial support and validate the strategic importance of quantum technology. This reduces the risk of cash depletion and signals policy tailwinds.
- High Gross Margin of 82.6%: D-Wave's trailing gross margin is 82.6%, reflecting the scalability of its software and cloud services. This high margin potential supports the bull case that once revenue scales, the company could achieve profitability.
Bearish
- Extreme Valuation: PS Ratio 341.6: The trailing price-to-sales ratio is 341.6, a 3,249% premium to the industry average of 10.2. Even the forward PS ratio of 19.4 assumes a 15,000% revenue increase, which is highly optimistic and leaves no room for error.
- Revenue Declining 80.9% YoY: Q1 2026 revenue fell to $2.858 million, an 80.9% drop from $15.001 million in Q1 2025. Excluding the one-time spike, revenue has stagnated around $2.7-3.1 million, indicating a lack of scalable product revenue.
- Negative Cash Flow and Dilution Risk: Free cash flow is -$102.2 million TTM, and the company is burning cash rapidly. With a current ratio of 42.4, it has liquidity, but the need to fund operations until 2028 raises dilution risk, as seen in the rising share count from 286M to 367M in a year.
- Massive Insider Selling: Insiders at leading quantum companies, including D-Wave, have sold $857 million in stock over two years with virtually no buying. This signals that those with the most knowledge are cashing out, a red flag for retail investors.
QBTS Technical Analysis
The prevailing price trend for D-Wave Quantum is a sharp downtrend over the past three months, with the stock declining 43.63% from its May 2026 peak. The current price of $16.99 sits at 36.3% of its 52-week range (between $12.75 and $46.75), indicating that the stock is trading near the lower end of its annual range. This positioning suggests that the stock has experienced a significant correction from its highs, potentially offering a value opportunity if the underlying fundamentals support a recovery, but also raising concerns about a falling knife scenario if the downtrend persists. The 1-year price change of +6.72% masks the extreme volatility, as the stock has swung from a low of $12.75 to a high of $46.75, reflecting the speculative nature of the quantum computing sector.
Beta
2.16
2.16x market volatility
Max Drawdown
-71.0%
Largest decline past year
52-Week Range
$13-$47
Price range past year
Annual Return
+9.9%
Cumulative gain past year
| Period | QBTS Return | S&P 500 |
|---|---|---|
| 1m | -23.0% | +0.2% |
| 3m | -29.5% | +4.8% |
| 6m | -9.5% | +15.0% |
| 1y | +9.9% | +20.1% |
| ytd | -40.2% | +13.4% |
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QBTS Fundamental Analysis
D-Wave's revenue trajectory is concerning, with the most recent quarter (Q1 2026) reporting revenue of $2.858 million, a year-over-year decline of 80.95% compared to Q1 2025's $15.001 million. This dramatic drop is partly due to a one-time revenue recognition in Q1 2025, but the underlying trend shows revenue declining from $3.095 million in Q2 2025 to $2.752 million in Q4 2025, indicating a stagnation or contraction in core business. The company's revenue segments show a heavy reliance on professional services ($983,000) and system sales ($86,000), with product and service other contributing only $30,000, highlighting the lack of scalable product revenue. The growth trajectory is negative, and the company is still in its early commercialization phase, which raises questions about its ability to achieve the explosive growth needed to justify its valuation.
Quarterly Revenue
$2858000.0B
2026-03
Revenue YoY Growth
-81.0%
YoY Comparison
Gross Margin
63.6%
Latest Quarter
Free Cash Flow
$-102168000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is QBTS Overvalued?
Given that D-Wave has negative net income (EPS of -$0.0423), the price-to-sales (PS) ratio is the most appropriate valuation metric, as it allows for comparison across companies regardless of profitability. The trailing PS ratio is 341.62, which is extremely elevated, reflecting the market's high expectations for future revenue growth. The forward PS ratio, based on estimated revenue of $431.87 million, would be approximately 19.4, implying that the market expects a massive revenue increase of over 15,000% from current levels, which is highly optimistic and likely unsustainable. Compared to the industry average PS ratio of 10.2 (from valuation data), D-Wave trades at a 3,249% premium, indicating that the stock is priced for perfection and any disappointment in growth could lead to severe multiple compression. Historically, the PS ratio has ranged from 48.1 to 3,353.6 over the past five years, and the current ratio of 341.62 is near the middle of this range, suggesting that while the stock is not at its most extreme valuation, it is still far from cheap.
PE
-23.6x
Latest Quarter
vs. Historical
N/A
5-Year PE Range 17x~59x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
-22.4x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are severe. D-Wave's revenue is minuscule and declining, with Q1 2026 revenue of $2.858 million down 80.9% YoY, and the company has never been profitable, with a net margin of -1,444%. The company burns cash at an alarming rate, with free cash flow of -$102.2 million TTM, and while it has a current ratio of 42.4, the need to fund operations until 2028 implies significant dilution risk. The debt-to-equity ratio is low at 0.051, but the reliance on equity financing is evident in the share count increase from 286 million to 367 million over the past year. Revenue concentration is also a concern, with professional services accounting for $983,000 of Q1 revenue, indicating a lack of scalable product sales.