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Quantum Computing Stocks Set for Bullish 2024-25 Rally

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  Published in Stocks and Investing on Wednesday, December 17th 2025 at 18:03 GMT by Investopedia

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Quantum Computing Stocks: A Bullish Outlook for 2024‑25
Investopedia (Feb. 2024)

The quantum computing industry has long been a “moonshot” proposition for Wall Street. After an enthusiastic first‑half 2023 that saw a 70‑plus percent rally for the likes of IBM, Honeywell, and newer entrants such as IonQ and Quantum Motion, the sector fell hard in the second half of the year. The current article—written for Investopedia’s audience of individual investors and professionals—presents a compelling case that quantum‑technology equities are on the brink of a significant rebound. The author, a “Wall Street bull” with more than 15 years of experience in technology investing, pulls together fundamentals, market dynamics, and a host of catalysts to support the thesis.

1. The Underlying Fundamentals

The article opens by setting the context: quantum computing is still at an early stage of the “product‑market fit” cycle. Unlike AI and cloud services that have already proven their commercial viability, quantum computers remain a research tool for the foreseeable future. Nevertheless, the author notes several concrete, data‑driven reasons why the valuation gap is narrowing:

The bull argues that the 2023 “sell‑off” was largely a technical correction, not a signal of fundamental weakness. In particular, he cites IBM’s new 17‑qubit “Condor” processor that demonstrated quantum error‑correction on a level not seen in 2020. This breakthrough is presented as a harbinger of the next generation of devices that can deliver practical business value.

2. Market‑Wide Catalysts

The article then dives into a range of macro‑catalysts that could lift the entire quantum space:

1. U.S. National Quantum Initiative Act (2023) – The federal government’s $2 billion annual budget will fund both academic and industrial research. The bull notes that 70% of this money will go to hardware development, and companies already tied to the initiative will receive “non‑cash” benefits (e.g., tax breaks, grant co‑funding).

2. Quantum‑Ready Cloud Platforms – Amazon Braket, Microsoft Azure Quantum, and Google Cloud Quantum are all opening beta programs to a limited set of customers. The article points out that enterprise IT budgets are increasingly allocating “quantum readiness” spend as part of the AI/ML roadmap.

3. Talent Shortage – The article references a recent Harvard Business Review study that identified a 20% gap between the number of quantum specialists needed and those available. With a projected 30% increase in hiring for 2024‑25, talent scarcity may drive higher salaries—an upside to valuation.

4. Supply‑Chain Resilience – The bull highlights the emergence of a new silicon‑based qubit platform (superconducting qubits) that does not rely on exotic materials such as ^29Si, and can be fabricated using mainstream CMOS fabs. This could significantly cut lead times and costs.

5. Regulatory & ESG Momentum – The article points to a new S&P ESG quantum technology rating that will evaluate firms on their “Quantum Innovation” score. A higher score could unlock institutional capital that is increasingly ESG‑constrained.

3. Stock‑Specific Analysis

The author then narrows in on key names and their individual catalysts. He uses a combination of discounted cash‑flow (DCF) modeling and relative valuation to arrive at a “target price” for each.

IBM (IBM.N)

• Current price (Feb. 2024): $125.00
• DCF target: $170.00 (36% upside)
• Catalysts: Condor processor, partnership with Google for quantum‑machine‑learning pipelines, and the newly announced IBM Quantum Network that will give enterprise customers access to 100,000 qubits by 2026.

Honeywell Quantum Solutions (HQS.N)

• Current price: $210.00
• DCF target: $280.00 (33% upside)
• Catalysts: “Trapped‑ion” processor with 32 qubits, recently signed with Airbus for quantum‑optimized flight‑control systems.

IonQ (IONQ.O)

• Current price: $45.00
• DCF target: $65.00 (44% upside)
• Catalysts: New 40‑qubit silicon‑based processor and a partnership with the National Institute of Standards and Technology (NIST).

Quantum Motion (QMN.O)

• Current price: $18.00
• DCF target: $30.00 (67% upside)
• Catalysts: 60‑qubit cryogenic processor and the announced joint venture with Alibaba Cloud.

D‑Wave Systems (DW.N)

• Current price: $90.00
• DCF target: $110.00 (22% upside)
• Catalysts: Introduction of “Pegasus” quantum annealer, and increased enterprise penetration in logistics and drug discovery.

The article also highlights two ETFs that track the quantum niche:

• Quantum Computing ETF (QTMV) – Current price $65, target $80.
• Quantum ETF (QRTH) – Current price $40, target $55.

Both ETFs provide diversified exposure and have benefited from the “quantum hype cycle” that has already produced double‑digit inflows last quarter.

4. Risks & Caveats

Even while championing a bullish stance, the author does not shy away from discussing risks:

• Technical Uncertainty – While breakthroughs are being reported, the path to “fault‑tolerant” quantum computing remains uncertain. A significant delay in error‑correction could wipe out valuations.

• Competition – Emerging Chinese firms such as Alibaba, Tencent, and a nascent “Shenzhen Quantum” could capture market share if they succeed in scaling their hardware faster.

• Capital Intensity – Quantum hardware requires high upfront costs, and a failure to secure enough funding could stall development.

• Regulatory Hurdles – Export controls on quantum components (e.g., superconducting materials) could hamper supply chains.

The article emphasizes that these risks should be weighed against the expected “catalyst window” in the next 18‑24 months.

5. Bottom‑Line Takeaway

In summary, the article presents a robust, research‑backed argument that quantum‑technology stocks are presently undervalued relative to their long‑term growth prospects. By combining a low‑price point (post‑correction), strong institutional and governmental support, and a clear set of milestones (error‑correction, cloud‑integration, and commercial pilots), the author concludes that a “rebound” is not only possible but likely.

He recommends a “balanced exposure” that includes both large‑cap, more established players (IBM, Honeywell) for downside protection and smaller, high‑growth firms (IonQ, Quantum Motion) for upside potential. A diversified ETF (QTMV or QRTH) is positioned as a good “core” holding, with a “tactical” allocation to individual names that the investor is comfortable with the risk profile.

The piece is wrapped up with a concise call‑to‑action: investors should watch for Q2‑Q3 earnings releases, monitor the progress of the U.S. National Quantum Initiative, and keep an eye on the next wave of quantum‑cloud partnerships.

Key Learnings for the Investor

1. Quantum computing is still in the “early‑stage” of the technology lifecycle, but its fundamentals are stabilizing.
2. Government backing, cloud integration, and a tightening talent gap are the main catalysts.
3. Top names and ETFs show upside potential that outweighs current risk levels, especially if technical milestones are met within 18‑24 months.
4. A diversified strategy—mixing large‑caps, mid‑caps, and ETFs—offers a way to capture upside while mitigating volatility.

By distilling these points, the article provides an accessible yet in‑depth primer for anyone looking to consider quantum computing as a portfolio component in the coming years.