D-Wave Quantum (QBTS): What’s Behind Today’s 13% Rally?

TLDR

• QBTS jumped ~12.9% as traders positioned ahead of CEO Dr. Alan Baratz’s presentation at the Semafor World Economy summit
• A sector-wide rally following a geopolitical ceasefire and a sympathy bounce from Rigetti’s hardware launch added fuel
• Analysts maintain a consensus “Moderate Buy” rating with a $36.50 price target despite recent target cuts
• QBTS missed its last quarterly earnings — EPS of ($0.09) vs ($0.05) expected, revenue of $2.75M vs $3.74M estimated
• Insiders have been net sellers, offloading 72,898 shares worth ~$1.75M over the past three months

D-Wave Quantum (QBTS) is having a strong session, climbing as much as 12.9% as a mix of event-driven momentum and broader sector tailwinds push the stock higher.

D-Wave Quantum Inc., QBTS

The primary catalyst appears to be CEO Dr. Alan Baratz’s upcoming presentation at the Semafor World Economy summit, where he is expected to discuss commercial quantum-AI applications and recent technical milestones. Traders have been positioning ahead of the event.

The move doesn’t exist in a vacuum, though. A sector-wide rally — sparked by a geopolitical ceasefire — lifted quantum stocks broadly. A sympathy bounce following rival Rigetti’s major hardware launch also helped carry QBTS higher.

The stock traded as high as $14.79 on Monday before settling around $14.67, up from a prior close of $14.25. Volume came in at around 16.3 million, roughly 41% below the average session volume.

Despite the day’s gain, QBTS is still trading well below both its 50-day moving average of $17.53 and its 200-day moving average of $24.61. Year-to-date, the stock is still down nearly 44%.

Analyst Targets and Ratings

Analyst sentiment remains cautiously positive. Fourteen analysts have a Buy rating on QBTS, with two holding Sell ratings, giving it a consensus “Moderate Buy.” The average price target sits at $36.50 — more than double the current price.

That said, several firms trimmed their targets in late February. Roth MKM cut from $40 to $30, Mizuho from $46 to $40, and Needham from $48 to $40. Benchmark held its Buy with a $35 target. Zacks went further, downgrading to “Strong Sell” in March.

Earnings Miss and Insider Selling

D-Wave’s most recent quarterly results, reported February 26th, came in below expectations on both the top and bottom lines. EPS landed at ($0.09), missing the ($0.05) consensus. Revenue came in at $2.75M versus the $3.74M estimate, though it was up 21.7% year-over-year.

The company carries a negative return on equity of 58.58% and a net margin of -1,444.10%.

On the insider front, two directors sold stock in March. Director Rohit Ghai sold 10,000 shares at $17.62, while Director John Dilullo sold 8,000 shares at $18.01. In total, insiders have sold 72,898 shares valued at approximately $1.75M over the past three months.

Institutional investors, however, have been moving in the other direction. AQR Capital Management grew its QBTS position by 201% in Q1. Royal Bank of Canada increased its stake by 59.8%. Institutional ownership currently stands at 42.47%.

Analysts forecast full-year EPS of ($0.41) for the current fiscal year.

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