IonQ Inc (NYSE: IONQ) rallied about 17% on Wednesday after a Japanese investment firm said it has built a sizable stake in the quantum computing company.
Rakuten Securities has bought 90,000 shares of IONQ for some $3.7 million, which represents about 1.5% of its portfolio and makes the quantum stock its ninth largest holding.
The online brokerage’s vote of confidence signals continued interest in IonQ that many believe could emerge as the leader of the quantum space.
Despite today’s rally, IonQ stock is down more than 50% versus its year-to-date high, most of which has been related to the recent tariffs driven rout in the US tech stocks at large.
Why else is IonQ stock up on Wednesday?
IonQ shares are gaining this morning also because the company has hit a patent milestone on the back of a recent acquisition.
In late February, the New York listed firm announced a controlling stake in ID Quantique – a deal that included nearly 300 quantum networking patents.
The transaction resulted in a significant boost to IonQ’s intellectual property portfolio.
Including ones that are pending, the company now has a total of nearly 400 quantum networking patents.
While IONQ shares have rallied hard this week, they remain unattractive for income investors as they do not currently pay a dividend.
Is there any upside left in IONQ?
IonQ stock is now up a total of about 25% versus its recent low. Still, a Morgan Stanley analyst continues to see significant further upside in shares of the quantum computing company.
Earlier this month, the investment firm reaffirmed its “equal weight” rating on IONQ but reduced its price target to $29.
Despite the revision, the new target still suggests a potential upside of over 30% from current levels.
Analysts at Morgan Stanley lowered their price target on IonQ primarily because it reported a much wider-than-expected loss for its fiscal fourth quarter in February.
In their research note, they did, however, express confidence in the company’s new management. IONQ named Niccolo de Masi as its new chief executive just weeks ago.
Should you invest in quantum computing in 2025?
Quantum computing is currently in its early innings only and the idea that it will someday have widespread, real-life utility is still up for debate.
But Rakuten Securities loading up on the AI stock suggests the Japanese firm doesn’t only believe in that future but expects IonQ to play a significant role in it too.
Plus, the increasing number of IonQ’s quantum networking patents makes it an intriguing investment opportunity as well. According to its CEO Niccolo de Masi:
Our patent portfolio and consistent delivery and outperformance of quantum networking tech and business milestones enables new opportunities to help our customers solve problems unsolvable with current tech.
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