Institutional Investors Bet Big on Rigetti Computing’s Quantum Future

Rigetti US76655K1034

The quantum computing specialist Rigetti Computing is commanding significant market attention as a new trading week begins. This surge in interest stems from a notable "Buy" initiation by analysts at Mizuho Securities and substantial position increases by major institutional funds. However, this institutional optimism stands in stark contrast to the company's current financial fundamentals, highlighting a critical market debate: is this a visionary investment in a future tech leader, or a speculative bubble fueled by hype?

Recent regulatory filings reveal aggressive buying by sophisticated investors. Headlands Technologies increased its stake by more than 215% during the second quarter. Tower Research Capital and Two Sigma Securities also significantly expanded their holdings in the company.

This activity is part of a broader, sustained trend. Over the past twelve months, net institutional inflows into Rigetti's stock totaled approximately $1.19 billion, dwarfing outflows of around $243 million. This pattern suggests that large-scale market participants are building early positions in anticipation of a potential technological breakthrough in quantum computing. The new "Buy" rating from Mizuho Securities provides further momentum for the volatile stock.

The Stark Reality of Current Valuation

Despite this institutional enthusiasm, the company's financial metrics present a sobering picture. Rigetti Computing currently carries a market capitalization exceeding $8.5 billion. Yet, its projected annual revenue for 2025 sits at a mere $5.2 million. While the company announced the $5.7 million sale of two Novera quantum systems in October, this revenue will not be recognized on its books until the first half of 2026.

These figures result in a price-to-sales ratio surpassing 1,000—an extraordinarily high valuation even within the technology sector. Investor sentiment appears driven by hopes that Rigetti could emulate the trajectory of a company like Nvidia. The critical difference is that Nvidia dominates an established market, whereas Rigetti remains deeply entrenched in the research and development phase for fault-tolerant quantum systems. The stock's current price of €22.40 reflects this uncertainty, trading roughly 53% below its 52-week high.

The Path Forward: A 2026 Inflection Point

In the near term, the significant gap between bullish analyst targets and the current share price is likely to fuel continued volatility. Mizuho has set an aggressive price target of $50 (approximately €47), while the average market target is a more conservative $28.50 (around €27).

The sustainable trajectory of the share price will ultimately hinge on developments expected in 2026. The successful delivery and integration of the Novera systems, coupled with the achievement of key technological milestones, will be crucial. Until those concrete results materialize, the stock is expected to remain highly sensitive to news flow and the capital movements of its institutional investor base.