IonQ Stock Hits a New Street-High Price Target

IonQ (NYSE:IONQ) stock has been a high-flyer over the past year, with the shares up by 475%. Now, with shares approaching their all-time high of $51.07, at least one top Wall Street expert believes a new record could be right around the corner.

Fueling this optimism is Benchmark’s David Williams, an analyst ranked among the top 2% on Wall Street, who raised his price target on IONQ to a Street-high of $55. This move suggests additional gains of 21% may lie ahead for the quantum computing specialist. (To watch Williams’ track record, click here)

Williams’ confidence comes on the heels of a recent fireside chat with IonQ’s CEO Niccolo de Masi and CFO Thomas Kramer, where several key themes reinforced his positive stance. In particular, the discussion highlighted how IonQ’s strategy is anchored in using targeted acquisitions to carve out a leading global position in the closely connected fields of quantum computing and quantum networking. According to management, these areas are deeply “symbiotic,” forming an integrated ecosystem that enables IonQ to offer comprehensive quantum solutions – from secure communications to tackling “complex computational problems.” This multifaceted approach stands in contrast to rivals who often focus on just one segment of the quantum landscape.

Delving deeper, a central pillar of IonQ’s growth plan is its focus on the quantum networking opportunity, a sector poised to become even more critical as quantum computers threaten current encryption standards. Management emphasized that quantum networking will be essential for safeguarding commerce, banking, and communications, presenting an immediate and pressing use case for the technology. As Williams notes, IonQ’s long-term vision centers on building a “quantum internet,” with its systems acting as central nodes, a market McKinsey projects could be worth $800 billion by 2040. Strategic acquisitions have supplied the technologies needed for this endeavor, putting IonQ in a strong position to capture a meaningful share of this massive opportunity.

Supporting this vision, the company recently followed up its Lightsynq acquisition with the purchase of Oxford Ionics, an integration management believes will significantly accelerate its technical roadmap. With these combined technologies, IonQ now expects to reach 256 physical qubits at 99.99% fidelity by 2026, surpass 10,000 physical qubits with 99.99999% logical fidelity by 2027, and scale to 2 million physical qubits and 80,000 logical qubits by decade’s end. Management’s confidence in its “accelerated commercial technical roadmap” is clear, with IonQ projecting it will outpace rivals by years – IBM, for example, does not expect to hit 2,000 logical qubits until 2033.

On the financial front, IonQ is also forecasting annual revenue to double for the foreseeable future, powered by a mix of hardware sales, QCaaS, applications, and quantum networking. While application development is currently a smaller revenue stream, it is seen as the “most important long-term value driver.” The strategy is to land customers through computing or networking solutions and expand from there to build a “sticky ecosystem.”

All told, that’s the bullish case from Benchmark. Broader Wall Street sentiment, however, paints a somewhat conflicting picture. On one hand, IONQ stock enjoys 4 additional Buys and 1 Hold, earning it a Strong Buy consensus rating. On the other, the average price target of $42.67 indicates shares are already fully valued. With that in mind, investors should watch closely for further price target revisions or potential rating changes in the near term. (See IONQ stock forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.