RGTI Should I Buy
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Rigetti Computing Inc (RGTI) is not a strong buy for a beginner investor with a long-term strategy at this time. The stock faces significant execution risks, potential equity dilution, and competitive headwinds. While the quantum computing market has long-term growth potential, the company's financial performance and current valuation concerns suggest holding off on investment until clearer signs of growth and stability emerge.
The technical indicators are mixed. The MACD is positive and expanding, suggesting a potential upward momentum, but the RSI is neutral at 46.714, and the moving averages are bearish (SMA_200 > SMA_20 > SMA_5). The stock is trading near its pivot level of 16.356, with key resistance at 17.572 and support at 15.139.
Long-term growth potential in the quantum computing market.
Positive sentiment from analysts like Mizuho, who see Rigetti as a scalable peer to IBM and Google.
Increased global cybersecurity spending driven by quantum-related threats.
Downgrade by TD Cowen citing premium valuation and competitive headwinds.
Execution risks and potential equity dilution.
Negligible revenue and heavy reliance on government contracts.
Insider selling and concerns about overvaluation in the quantum computing sector.
In Q3 2025, Rigetti's revenue dropped by -18.12% YoY to $1.947M. Net income increased significantly to -$200.968M (+1254.87% YoY), but this reflects a high loss. EPS improved to -0.62 (+675% YoY), but gross margin dropped by -59.02% YoY to 20.75%. Overall, the financials indicate weak revenue growth and profitability concerns.
Analyst sentiment is mixed. TD Cowen downgraded the stock to Hold, citing valuation and competition concerns. B. Riley upgraded it to Buy, citing valuation and near-term commercial trajectory. Wedbush and Mizuho initiated coverage with Outperform ratings, highlighting long-term potential in the quantum computing market. Jefferies initiated coverage with a Hold rating, citing execution risks and revenue dependency on government contracts.
