GOOGL, Microsoft & IBM: Top 5 quantum computing stocks to watch in Q2

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 GOOGL, Microsoft & IBM: Top 5 quantum computing stocks to watch in Q2
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  • Microsoft Corporation (NASDAQ: MSFT) has a P/E ratio of 32.34, and its dividend yield is 0.82%
  • International Business Machines Corporation’s (NYSE: IBM) P/E ratio is 20.43, and the dividend yield is 4.99%
  • Honeywell International Inc’s (NASDAQ: HON) stock has a P/E ratio of 24.72 and the dividend yield is 1.98%

Quantum computing technology is a buzzing theme in 2022. The technology may have a lot of potential with big data and AI. As the name suggests, quantum computing uses quantum phenomena in computing. The technology makes monitoring and analyzing data possible rapidly. 

Quantum technology can transform industries, including finance, telecom, agriculture, pharmaceuticals, etc. 

Microsoft Inc. (MSFT) already provides quantum computing services with Azure Quantum, and Amazon uses Bracket. Alphabet has also entered the segment. 

With the constantly developing technology, computing power growth is necessary. The solution may lie in the scale. By using the power of quantum mechanics to solve issues, quantum computers can perform tasks that even the best classic supercomputers in the world cannot achieve. 

What a quantum computer can perform in one second may take around one week is done by the classic super-computer. Its potential is boundless. 

Here, we discuss five quantum stocks.

Alphabet Inc. (NASDAQ: GOOGL)

Market capitalization: US$1.87 trillion

Closing price on March 25, 2022: US$2,833.46

Mountain View, California-based Alphabet Inc, the holding company of Google, generates around 99% of its revenue from the internet media giant.

For the fiscal year ended December 31, 2021, the company booked US$182.5 billion in revenue compared to US$257.6 billion in FY 2020. The net income of the technology company came in at US$40.27 billion compared to US$76.03 billion in the previous financial year.

The company also announced a 20 for one stock split, for which the date is July 1. 

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The company aims to create a useful quantum computer. In a recent development, the management spun off its quantum computing unit, Sandbox, this month. 

The stock has a P/E ratio of 25.25, and the forward P/E ratio for one year is 24.07. The stock traded in the price range of US$3,030.93 to US$2,003.85 in one year. 

It traded at US$2,835.00 with a 0.05% gain in the pre-market at 8:30 am ET on Monday.

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 Quantum stocks

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Microsoft Corporation (NASDAQ: MSFT)

Market capitalization: US$2.27 trillion

Closing price on March 25, 2022: US$303.68

Redmond, Washington-based Microsoft is known for its Windows operating systems and Office productivity suite. 

The company is into quantum computing with its Azure cloud platform, which gives access to quantum resources to the companies without high expenses and costs. The Azure Quantum platform offers resources from more than Microsoft, such as from QCI, Honeywell etc., to the clients. 

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For the three months ended December 31, 2021, the company reported a revenue of US$51.73 billion compared to US$43.08 billion for the same period in the previous year. The net income of the company was US$18.77 or US$2.48 per diluted share compared to US$15.46 billion or US$2.03 per diluted share in the same quarter in 2020.

The stock has a P/E ratio of 32.34, and the dividend yield is 0.82%. The stock traded in the price range of US$349.67 to US$231.10 in the last 52 weeks. 

The stock was up US$0.14% to US$304.11 at 8:29 am ET in the pre-market on Monday.

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International Business Machines Corporation (NYSE: IBM)

Market capitalization: US$116.7 billion

Closing price on March 25, 2022: US$131.35

IBM is one of the leading quantum computing companies. The company is engaged in providing the overall IT needs of enterprises. It sells software, services, hardware and provides consulting. Armonk, New York-based IBM operates in 175 countries and has around 80,000 business partners to service 5,200 clients. 

IBM is steadily offering new versions of cloud computing technologies to its clients. In February, IBM acquired Neudesic, a cloud services consultancy specializing primarily in the Microsoft Azure platform, to expand IBM’s hybrid multi-cloud services AI strategy portfolio.

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For the fiscal year 2021, its revenue was US$57.37 billion compared to US$55.18 billion in fiscal 2020. The net income reported was US$5.74 billion or US$6.35 per share diluted versus US$5.59 billion or US$6.23 per share diluted in FY 2020.

The stock has a P/E ratio of 20.43, and the dividend ratio is 4.99%. The stock moved between US$152.84 to US$114.56 in the last 52 weeks.

The IBM stock was up US$131.675 with a 0.25% gain in the pre-market at 8:28 am ET.

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Honeywell International Inc. (NASDAQ: HON)

Market capitalization: US$134.2 billion

Closing price on March 25, 2022: US$197.79

Charlotte, North Carolina-based Honeywell operates through four business segments. These are aerospace, building technologies, performance materials & technologies, and safety & productivity solutions. The company manufactures technology products, aerospace equipment and advanced materials. 

In November 2021, it merged Honeywell Quantum Solutions with Cambridge Quantum Computing to create Quantinuum to speed up the development of quantum technology and deliver faster quantum solutions. Honeywell is Quantinuum’s owner with more than a 50% ownership stake, its investor, supplier as well as customer. 

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For the fiscal year ended December 31, 2021, it posted a net income of US$5.61 billion or US$7.91 per diluted share on net sales of US$34.39 billion. The net income and revenue were US$4.87 billion or US$6.72 per diluted share and US$32.64 billion, respectively, in FY 2020. 

The stock has a P/E ratio of 24.72. Its dividend yield is 1.98%, and its annualized dividend is US$3.92. The stock moved in the price range of US$236.86 to US$174.42 in the last 52 weeks.

The HON stock rose 0.70% to US$199.18 at 8:31 am ET in the pre-market Monday.

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Source: Pixabay

Rigetti Computing, Inc. (NASDAQ: RGTI)

Market capitalization: US$803 million

Closing price on March 25, 2022: US$7.31

Berkeley, California-based Rigetti Computing is engaged in the full-stack quantum computing business. The company has developed a multi-chip quantum processor for scalable quantum computing systems. Its cloud service platform serves enterprises and research centers, including the National Aeronautics and Space Administration (NASA).

For the fiscal year 2021, the company generated revenue of US$8.2 million, a 48% increase YoY. The net GAAP loss for the fiscal year 2021 came in at US$38.2 million compared to US$26.1 million for fiscal 2020. The net loss per share was US$1.74 versus US$1.26 for the fiscal year 2020.

The RGTI stock traded in the price range of US$12.75 to US$5.91 in one year. The stock was up 1.78% to US$7.44 at 8:39 am ET in pre-market Monday.

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Bottom line:

Quantum computing is a comparatively new technological sphere, but as quantum machines improve, data analysis may open new market opportunities.  

Presently, most companies use artificial intelligence for critical tasks. With quantum computing and AI, businesses may have more reliable, faster and accurate insights and would be able to handle issues more easily, for example, supply chain, sustainability etc. 

However, an investor must exercise due diligence while investing in the stock market.


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