Two Quantum Computing Stocks in Billionaire's Portfolio Show Explosive Growth, But Analysts Warn of Valuation Risks

The Quantum Bet That Has Wall Street Divided

When legendary hedge fund manager Ken Griffin’s Citadel Advisors quietly accumulated positions in Rigetti Computing and D-Wave Quantum during the third quarter, it sent ripples through the investment community. These two quantum computing companies have delivered staggering returns to early investors — Rigetti surged 3,750% since early 2023, while D-Wave climbed 1,770% from early 2024 onward. Yet beneath these eye-popping gains lies a more complex story about valuation, technology differentiation, and the timeline for practical quantum breakthroughs.

Rigetti Computing: Vertical Integration Meets Extreme Valuation

Rigetti Computing has carved out a distinctive niche through vertical integration and pioneering multi-chip quantum processor design. The company manufactures its own superconducting quantum processors and develops the complete software and hardware stack needed for cloud-based quantum services. Among the seven Wall Street analysts tracking the stock, the consensus target price sits at $40 per share — implying 42% upside from current levels, with the most bullish call reaching $51 (82% potential gain).

Yet beneath this optimism lies a troubling reality: Rigetti’s price-to-sales multiple of 1,080 dwarfs even the priciest names in the S&P 500. To put this in perspective, it trades at roughly 10 times the valuation multiple of Palantir Technologies, itself considered premium-priced by most measures. This type of valuation disconnect typically doesn’t persist. The quantum computing market itself is projected to remain a mere fraction of artificial intelligence’s size — roughly 450 times smaller through 2030, according to Grand View Research.

D-Wave Quantum: Solving Today’s Problems, Facing Tomorrow’s Questions

D-Wave takes a fundamentally different technical approach, specializing in quantum annealing rather than gate-based architectures. While annealers cannot execute most quantum algorithms, they excel at narrow optimization tasks. Notably, D-Wave currently deploys systems with over 4,000 physical qubits — a stark contrast to Rigetti’s roadmap, which doesn’t envision 1,000-qubit systems until 2027. This advantage translates to near-term utility, even if that utility remains limited.

The financial picture reveals growing pains. Third-quarter revenue doubled to $3.7 million, yet non-GAAP net losses reached $18.1 million. The company has masked persistent red ink through aggressive share dilution — outstanding shares expanded 31% year-to-date and 117% over two years. From a valuation perspective, D-Wave trades at 325 times sales. While cheaper than Rigetti on this metric, both companies command prices that seem detached from reality, particularly when quantum computing is forecast to grow just 21% annually through the decade’s end.

The Uncomfortable Truth About Timing

Both stocks carry meaningful downside risk despite positive analyst sentiment. The median D-Wave target of $40 suggests 48% upside from current pricing, with even the most conservative call implying 30% gains. However, history suggests that even when Wall Street consensus points higher, the valuation structures here are inherently unstable. Observers with long investment horizons should consider waiting for significantly better entry points or maintaining minimal position sizes if they do participate.

The quantum computing revolution may indeed arrive, but the timeline for commercially viable, fault-tolerant systems remains distant — likely one to two decades away. Patient capital wins in emerging technologies, but overpaying at the inflection point destroys returns. Ken Griffin’s moves signal confidence in the sector’s long-term trajectory, but his microscopic position sizes suggest even sophisticated institutional investors are proceeding with caution.