The market has a tendency to fall in love. Not with a person, but with a story. And right now, Wall Street is absolutely infatuated with the story of quantum computing, a narrative of world-changing potential, cryptographic breakthroughs, and computational power beyond our wildest dreams. The object of its most recent and intense affection is Rigetti Computing (RGTI).
The numbers are, on the surface, spectacular. A stock price that has surged approximately 2,500% over the last 12 months, cresting at nearly $39 a share in early October. A market capitalization that ballooned to $11.5 billion. Trading volume spiked to around 144 million shares on October 2nd—to be more exact, 144.3 million—a torrent of capital three times the normal flow. Imagine the flicker of the ticker symbol RGTI, numbers flashing green, volume bars dwarfing everything else on the screen. It’s the kind of chart that creates legends and, more often, cautionary tales.
The consensus from the analyst community is a "Strong Buy," and institutional giants like Vanguard and BlackRock have been increasing their positions. But when you strip away the narrative, a profound discrepancy emerges, one that has led to headlines asking, Rigetti (RGTI) Quantum Stock Rockets on Big Deals – Is the $10B Hype Real? The market is pricing Rigetti not for what it is, but for what it might become decades from now. And that is a very dangerous game.
A Valuation Disconnected from Reality
The recent catalysts for this parabolic move appear, at first glance, to be solid business developments. On September 30, Rigetti announced purchase orders for two of its 9-qubit Novera quantum computers, totaling about $5.7 million. A few weeks earlier, it secured a three-year, $5.8 million contract with the Air Force Research Laboratory. These are tangible, real-world wins.
But let’s place these numbers in their proper context. The company’s market capitalization is $11.5 billion. The combined value of these two flagship deals is $11.5 million. This means the market is assigning a valuation to Rigetti that is precisely 1,000 times the value of its most significant recent commercial and government contracts. To put it another way, these celebrated wins represent just 0.1% of the company's total market value.
This is like discovering a single, promising drop of oil in a vast, unexplored desert and immediately valuing the entire territory as if it were another Saudi Arabia. It’s a valuation based on pure, unadulterated potential, completely unmoored from the current financial gravity. Do these contracts represent a genuine inflection point in commercial adoption, or are they high-profile, subsidized experiments that don't yet signal a scalable market? The data suggests the latter.
The company’s own financial statements paint a picture not of a thriving tech giant, but of a very early-stage research and development firm. For the first half of 2025, total revenues were a mere $3.3 million. In the second quarter alone, the company posted a net loss of $39.7 million. Rigetti is burning cash, not earning it. While its balance sheet is strong with $571.6 million in cash (bolstered by a recent $350 million share offering) and no debt, this capital is the fuel for a long, uncertain journey, not the spoils of victory.
The Telling Actions of Insiders
Perhaps the most illuminating data point in this entire affair isn’t in a press release or an SEC filing, but in the transaction logs of the people who know the company best: its own executives. Recently, company insiders have sold approximately 1.8 million shares for over $21 million. Most notably, CEO Subodh Kulkarni himself sold one million shares.
And this is the part of the analysis that I find genuinely puzzling. These sales are occurring while the stock is on a historic run, and while the dominant public narrative is one of limitless future growth. This action stands in stark contrast to the market’s euphoria. It’s one thing for an executive to diversify their holdings, but the scale and timing here demand scrutiny. If the long-term outlook is as bright as the stock chart suggests, why are the individuals with the most information converting their equity to cash at these levels?
Their actions seem to align more closely with the CEO’s own sober assessment than with the market’s fever dream. Kulkarni himself has stated that the company is "four to five years from real commercial value of quantum computing." This is a remarkably candid and realistic timeline. It is also a timeline that the current $11.5 billion valuation seems to completely ignore.
The market is behaving as if "real commercial value" has already arrived, or is just around the corner. But the people running the company are telling us, both with their words and their wallets, that it is still years away. When the market’s perception and the insiders’ actions diverge so dramatically, my discipline as an analyst is to trust the actions. They are the purest data signal available.
This Isn't an Investment, It's a Lottery Ticket
Let’s be clear. Quantum computing may very well be, as one strategist put it, "the most important technological race of our generation." The potential is undeniable. But potential does not pay the bills, and a story is not a balance sheet. Rigetti, along with its peers IonQ and D-Wave, is a fascinating scientific endeavor wrapped in the ticker symbol of a publicly traded company.
Buying RGTI at these levels isn't an investment in a business with predictable cash flows or a defensible market position. It is a highly speculative bet that the company will, against all odds, survive a multi-year cash burn, beat out immense competition from both startups and trillion-dollar tech giants, and eventually create a commercial market that doesn't fully exist yet. It's a bet on a miracle, priced as a certainty. The discrepancy between the analyst price targets—averaging around $20—and the current trading price above $35 underscores this disconnect. The professionals are bullish, but not this bullish. The current valuation is a statistical outlier, driven by narrative momentum, not fundamental analysis.
