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Israel Englander is the billionaire founder and CEO of Millennium Management. He has a reputation as one of Wall Street’s most successful hedge fund managers. With over $75.8 billion in assets under management, Millennium has only had one losing year since its founding in 1989.
Englander recently bought Rigetti Computing (RGTI) and D-Wave Quantum (QBTS). Both are quantum computing stocks, and investors have been particularly active in trading them after Microsoft’s (MSFT) Majorana 1 announcement.
Quantum computing is considered the next logical step after artificial intelligence (AI) as traditional computing chips become harder to scale. Investors have been piling into quantum computing stocks as the AI rally began to get stretched, and many see this as an industry that could return multibagger gains once quantum computers become commercially viable. Israel Englander seems to agree.
Quantum Computing Stock #1: Rigetti Computing
Englander bought 1,417,666 shares of RGTI during the fourth quarter of 2024, worth about $15 million. The stock rose over 2,200% during this quarter before it started to come back down. RGTI stock is down more than 60% from its 52-week high.
The company is known for its superconducting qubit technology. This tech offers fast gate speed and scalability, and Rigetti is also the industry’s first multi-chip quantum processor. It operates Fab-1, which is the only dedicated quantum fab facility. It has contracts with governments and good technology, but the sudden excitement and rally in quantum computing stocks is most likely why Englander bought the stock.
It generated $2.4 million in sales in the past year and posted a net loss of $14.8 million in its most recent quarter. Analysts don’t expect it to turn profitable anytime soon, and considering how early quantum computing still is, it’s fair to call Rigetti a pre-revenue company. It had $92.6 million in cash and cash equivalents as of Q3 2024.
RGTI currently has a “Strong Buy” rating from most analysts, but following Israel Englander’s Q4 2024 buy-in so far into 2025 wouldn’t be a wise idea. The broader market sentiment has shifted considerably more bearish, so RGTI is a speculative buy at best. In my opinion, shares can fall a lot further.
Quantum Computing Stock #2: D-Wave Quantum (QBTS)
Englander bought 2,273,530 shares of D-Wave (QBTS) in Q4 2024. At the time of reporting, this was worth $16.4 million. D-Wave also seems to have peaked, with shares down more than 50% from their 52-week high.
D-Wave Quantum claims to be the world’s first company to sell computers that exploit quantum effects. It has a suite of open-source Python tools and a cloud-based service that provides real-time access to quantum computers.
Much like RGTI, QBTI is another speculative buy. D-Wave Quantum has a similar financial profile to Rigetti Computing, as it posted $22.7 million in losses in the latest quarter compared $1.9 million in revenue. Analysts do not expect profitability for QBTS for the foreseeable future.
Five of the six analysts covering the stock give it a “Strong Buy” rating. But again, I’d argue it wouldn’t be a smart idea to invest in it now, as the rally has cooled off.
The Bottom Line
Pure-play quantum computing stocks are on the far end of the speculation scale due to how long you’d have to wait for fundamental results. Each quantum startup has its own approach to the cutting-edge technology, and they’re competing with companies that have deeper pockets. A long-term investment isn’t very realistic with these two quantum computing stocks as you’re more likely to be diluted to near zero before they break even.
Neither QBTI nor RGTI constitute a large portion of Englander’s portfolio.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
