Quantum computing stocks are jumping in today’s trading after the Trump administration announced that it will invest $2 billion in nine quantum computing companies and will receive equity stakes in them. The goal is to strengthen the U.S. quantum supply chain and compete more directly with China. The Commerce Department said that tech giant IBM (IBM) will receive $1 billion to create a new company focused on making quantum computer chips, while GlobalFoundries (GFS) will receive $375 million to build a U.S. factory that can make parts for different types of quantum machines.
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IBX: an alternative to margin or options on IBMOther companies, including D-Wave (QBTS), Rigetti Computing (RGTI), and Infleqtion, will receive about $100 million each, while Diraq will get up to $38 million. The money will come from CHIPS and Science Act incentives, and it shows how much more directly the government is getting involved in strategic industries. Commerce Secretary Howard Lutnick said that these quantum investments are meant to grow the domestic industry, create thousands of high-paying American jobs, and improve U.S. quantum capabilities.
Still, quantum computing is not ready for mass commercial use yet. Quantum computers are designed to solve certain problems much faster than traditional supercomputers, including areas like drug discovery, financial modeling, and cryptography. However, they still face major technical issues, especially high error rates that limit how useful they are in the real world, at least for now.
Is IBM a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on IBM stock based on 10 Buys, seven Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average IBM price target of $287.80 per share implies 18.6% upside potential.
