Key Takeaways
- Rigetti Computing (RGTI) saw Jefferies cut its price target from $18 to $12 while maintaining a Hold rating, despite the company’s progress in quantum computing technology.
- Rigetti achieved 99.5% median two-qubit gate fidelity on its 108-qubit system, but third-quarter revenue declined to $1.4 million from $1.9 million a year earlier.
- TIKR’s November 11 estimates projected revenue of $43.5 million in 2027 and $71.3 million in 2028, although both figures depend on stronger commercial execution.
- Rigetti ended September with $497.1 million in cash and investments and no debt, but converting its 2027 sales pipeline into orders remains critical.
What Happened?
Rigetti Computing (RGTI) achieved its 108-qubit system’s fidelity target, yet Jefferies still cut its stock price target by a third. The concern wasn’t its quantum technology, but whether commercial revenue could catch up with that progress.
Jefferies analyst Kevin Garrigan lowered his price target from $18 to $12 on November 11 while maintaining a Hold rating, reflecting continued uncertainty around Rigetti’s commercial outlook.
According to the company’s third-quarter financial results, revenue declined to $1.4 million from $1.9 million a year earlier, falling below the approximately $3.7 million analysts expected.
CEO Subodh Kulkarni said the system “achieved our goal of 99.5% median two-qubit gate fidelity,” reinforcing confidence in its chiplet-based architecture.
Jefferies acknowledged the technological progress and improved funding position but remained concerned about uneven revenue and limited visibility into future system deployments.
Rigetti maintained its 2026 revenue outlook of approximately $20 million, assuming customer acceptance of a quantum computing system ordered by India’s Centre for Development of Advanced Computing (C-DAC).
With $10.9 million in revenue through September, Rigetti needs approximately $9.1 million in fourth-quarter revenue to meet that target. The $8.4 million C-DAC system accounts for most of the required amount.
Quarterly operating losses reached $33.2 million, highlighting the gap between technological achievements and commercial performance.
Rigetti also entered into an agreement with the U.S. Department of Commerce for an award of up to $100 million to support quantum computing research and development, in exchange for a minority, non-controlling equity stake.
The company ended September with $497.1 million in cash and investments and no debt, providing financial flexibility as it continues developing its technology.
Is Rigetti Stock Undervalued or Overvalued?
Rigetti shares appear overvalued based on current revenue visibility, despite their substantial decline.
The stock closed at $9.62 on November 13, implying approximately 25% upside to Jefferies’ revised $12 price target.
According to TIKR’s November 11 chart, analysts had an average price target near $26, down from approximately $34 a year earlier. More recent analyst reductions have brought some publicly reported consensus estimates closer to $21, reflecting growing concerns about Rigetti’s commercial outlook.
Revenue forecasts explain why analysts remain cautious.
According to TIKR’s November 11 estimates, analysts expected approximately $43.5 million in revenue for 2027 and $71.3 million for 2028, compared with an earlier 2028 estimate of $102.5 million at the end of June.
Rigetti traded at approximately 112x next-twelve-month sales on November 10, compared with its three-year average of 226x.
Although the multiple has fallen substantially, that historical average was elevated by periods of market enthusiasm and does not necessarily indicate that Rigetti is undervalued today.
Using the November 10 valuation snapshot, Jefferies’ $12 target would still imply approximately 111x forward sales, reflecting substantial expectations for future commercial growth.
Jefferies’ Hold rating therefore appears reasonable. Rigetti has demonstrated meaningful technological progress and has substantial financial resources, but its valuation remains dependent on stronger commercial execution.
Over the next 12 months, the biggest catalysts will be C-DAC’s system acceptance, conversion of Rigetti’s 2027 sales pipeline into firm orders, and continued progress toward its next-generation quantum computing roadmap.
Stronger system sales, timely customer acceptance, and additional commercial orders could support a higher valuation. However, further delivery delays or downward revenue revisions would make Rigetti’s premium valuation increasingly difficult to justify, even with its technological progress and substantial cash reserves.
So what is Rigetti Computing stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
