Key insights
- RGTI's stock is down significantly from its high. The company has a high valuation relative to its low revenue, but possesses a substantial cash reserve providing a long runway. Upcoming earnings on May 11, with an optimistic revenue consensus, could be a catalyst. A miss could drive the stock lower, while a hit could signal a revenue inflection. Overall, the situation presents a high-risk, high-reward scenario.
I've been poking around quantum plays for a few weeks trying to figure out if any of them are actually worth owning or if it's all just hype with a hardware roadmap attached. $RGTI kept coming up because the chart looks genuinely ugly, peaked at $58 last year and sitting at $17 now, and usually when something drops that hard I want to know if it's dead or just forgotten.
Turns out it's more complicated than I expected.
The revenue is bad. Like, actually bad. Four quarters in a row of missing estimates, TTM around $7M, and the stock is valued at $6B. EV/Sales somewhere around 835x if you do the math. That number alone should probably end the conversation.
But then I looked at the balance sheet and it threw me off. They raised roughly $382M through stock issuance last year in a single quarter, and right now they're sitting on $589M in cash and short-term investments. Burn rate is roughly $15M per quarter. That's close to a decade of runway without touching equity markets again. I was expecting a company on the edge of dilution hell and it's not that.
The dilution already happened though. Share count went from around 188M to 310M in about a year. If you held through the raise you got compressed pretty hard, which explains a lot of the chart.
What made me actually pay attention: earnings are May 11. Analyst consensus is $4.13M revenue, more than double last quarter. Either someone knows something about a contract materializing or that estimate is just optimistic noise. If they hit it, it's the first real revenue inflection this company has shown. If they miss again at this valuation I don't see what holds it above $15.
Not in it. But watching into the print.
Full breakdown here if anyone wants the metrics: https://www.stoxcraft.com/stocks/rgti https://de.tradingview.com/symbols/NASDAQ-RGTI/
Anyone holding through earnings or has the miss history made this untouchable?