2 Top-Rated Quantum Computing Stocks to Buy for May 2025
In recent years, quantum computing has quietly emerged into the mainstream, with the market set to explode from $1.2 billion in 2024 to $12.6 billion by 2032, expanding at a 34.8% compound annual growth rate (CAGR). The growth is reflected in the performance of Defiance Quantum ETF (QTUM), which has gained 40.3% over the past year, outperforming the S&P 500 Index's ($SPX) 13.1% rise.
Amid this transformation, Amazon.com (AMZN) and D-Wave Quantum (QBTS) have emerged as strong investment opportunities. Their recent performance indicates growing confidence in the integration of artificial intelligence and quantum computing into everyday technologies.
For forward-thinking investors, this could represent a unique 'ground-floor' opportunity in what many see as the defining innovation of the 21st century.
Quantum Computing Stock #1: Amazon
Headquartered in Seattle, Washington, the e-commerce giant has long outgrown its retail roots. Today, with a massive $2.2 trillion market cap, Amazon.com (AMZN) holds a dominant seat in the cloud computing space through Amazon Web Services and remains deeply entrenched in households through its Alexa-powered Echo devices.
Over the past month, AMZN stock has rallied 15%.
AMZN currently trades at 30.6 times forward earnings and 3.2 times sales, commanding a premium over industry peers. Yet, stacked against its own five-year averages, these valuations hint at a hidden bargain.
The May 1 earnings report unveiled a strong first-quarter 2025 performance that came in ahead of expectations. Total net sales reached $155.7 billion, marking an annual increase of nearly 8.6%, beating by $580 million. Operating income stood at $18.4 billion, up 20.2% from the year-ago figure.
Moreover, EPS rose 62.2% annually to $1.59 and beat forecasts by $0.23.
Moreover, Amazon Web Services (AWS) has made significant strides in quantum computing. In early 2025, AWS launched its Ocelot quantum chip, reducing error correction costs by 90%, positioning Amazon as a leader in scalable quantum computing and boosting its AWS growth.
Looking ahead, Amazon expects Q2 net sales between $159 billion and $164 billion, projecting 7% to 11% year-over-year growth. Meanwhile, analysts anticipate Q2 2025 EPS to grow 8.9% to $1.34. For 2025, EPS is forecast to rise 13.9% year over year to $6.30.
Analyst sentiment skews overwhelmingly bullish with an overall rating of 'Strong Buy.' Out of 53 analysts, 46 issued a 'Strong Buy,' five suggested a 'Moderate Buy,' and two recommended 'Hold.'
The average price target of $241.46 represents potential upside of 14%, while the Street-high target of $305 signals a possible surge of 45% from current levels.
Quantum Computing Stock #2: D-Wave Quantum
D-Wave Quantum (QBTS), based in Palo Alto, California, provides end-to-end quantum computing solutions, including systems, cloud services, application development tools, and professional services. The company is currently valued at a market cap of $3.1 billion.
QBTS stock has delivered a 685% gain over the past 52 weeks and shares are up another 48% in the past month.
D-Wave reported its first-quarter results on May 8. Revenue surged an impressive 500% year-over-year to $15 million, and the company reported record GAAP gross profit of $13.9 million. Its net loss also narrowed dramatically to $5.4 million from $17.3 million in the year-ago period.
Major quantum computing achievements in the first quarter included a published scientific paper demonstrating quantum supremacy, the delivery of its first quantum Advantage system, and various key business relationships formed with customers like Japan Tobacco and Ford Otosan.
For the second quarter, analysts are calling for losses per share to improve 40% to to $0.06. For the full year, losses are expected to improve 72% to $0.21.
The stock has earned an overall 'Strong Buy' rating. Out of six analysts covering the stock, five have backed it with a 'Strong Buy,' while one maintains a more cautious 'Moderate Buy.'
The average price target of $11.33 represents minimal upside from its current price. However, the Street-high target of $13 points to a possible rally of more than 20% from current levels.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
19 minutes ago
- Globe and Mail
Asian shares dither, U.S. dollar falls as trade angst persists amid tariffs
Asia shares edged cautiously higher on Tuesday while the U.S. dollar fell to a six-week low as the country's erratic trade policies clouded over markets and investors turned defensive ahead of key developments later in the week. U.S. President Donald Trump and Chinese leader Xi Jinping will likely speak this week, White House press secretary Karoline Leavitt said on Monday, days after Trump accused China of violating an agreement to roll back tariffs and trade restrictions. The call between the two leaders will be closely watched by markets to see if the tariff-induced blow to global stocks and the dollar this year could get some reprieve or ratchet up, as trade tensions between the world's two largest economies simmer. Data on Monday showed U.S. manufacturing contracted for a third straight month in May and suppliers took the longest time in nearly three years to deliver inputs amid tariffs. 'The May ISM showed tariff pressure is beginning to bite for manufacturers who are seeing slowing activity, longer lead times and declining inventories,' said economists at Wells Fargo. China's factory activity in May also shrank for the first time in eight months, a private-sector survey showed on Tuesday, indicating U.S. tariffs are starting to hurt manufacturers. The gloomy global trade situation left U.S. futures falling early in the Asian session, failing to sustain the slight gains made during the cash session on Wall Street overnight. Nasdaq futures and S&P 500 futures were both down 0.2 per cent each. In Europe, EUROSTOXX 50 futures advanced 0.28 per cent and FTSE futures added 0.15 per cent. MSCI's broadest index of Asia-Pacific shares outside Japan reversed early losses to last trade 0.6 per cent higher, while Japan's Nikkei rose 0.66 per cent. Trump administration seeks pause after losing second tariff case, says decision jeopardizes trade negotiations 'Trump really does have sentiment in the palm of his hands once again,' said Matt Simpson, senior market analyst at City Index. 'I suspect we'll hear about 'a really great call' or words to the effect,' he said, referring to the expected call between Trump and Xi. 'But we'll need to wait for confirmation from China, who tends to take their time on these matters. Until we get concrete confirmation, price action could be shaky and vulnerable to false breaks . . . we also have the June 4 deadline for 'best trade deals' from U.S. trading partners to factor in.' In China, mainland markets returned from an extended break on a muted note, with the CSI300 blue-chip index up 0.23 per cent while the Shanghai Composite Index gained 0.3 per cent. Hong Kong's Hang Seng Index jumped more than 1 per cent, rebounding from Monday's one-month low. Opinion: Reversing a trade deficit with China is no simple matter – just ask Queen Victoria The U.S. dollar fell to a six-week low against a basket of currencies to 98.58 on Tuesday, ahead of Friday's U.S. nonfarm payrolls data, which will offer a timely reading on the pulse of activity in the world's largest economy. A rise in unemployment is one of the few developments that could get the Federal Reserve to start thinking of easing policy again, with investors having largely given up on a cut this month or next. The euro scaled a six-week top earlier in the session before paring some of its gains to last trade at US$1.1426, while sterling dipped 0.09 per cent to US$1.3532. A softer U.S. jobs report would be a relief for the Treasury market, where 30-year yields continue to flirt with the 5 per cent barrier as investors demand a higher premium to offset the ever-expanding supply of debt. The Senate this week will start considering a tax-and-spending bill that will add an estimated $3.8 trillion to the federal government's $36.2 trillion in debt. 'The evidence suggests term premium being re-priced considerably higher to account for U.S. fiscal, trade, credit, and geoeconomic risks alongside some hedge against [U.S. dollar] debasement,' said Vishnu Varathan, head of macro research for Asia ex-Japan at Mizuho. The dollar was up 0.35 per cent against the yen at 143.20, reversing some of its 0.9 per cent decline from the previous session. Bank of Japan Governor Kazuo Ueda said on Tuesday it is important to make policy judgements without any preset ideas as uncertainty over global tariff policies remains extremely high. In commodities, oil prices rose on concerns about supply, with Brent crude futures climbing 0.88 per cent to US$65.20 a barrel, while U.S. crude surged 1 per cent to US$63.13 per barrel. Spot gold rose to a roughly one-month high of US$3,392.03 an ounce.
Globe and Mail
an hour ago
- Globe and Mail
Asian markets rise as US stock indexes near records amid easing trade tensions
Shares rose early Tuesday in Asia after U.S. stock indexes drifted closer to records, while oil prices extended gains. Beijing and Washington dialed back trade friction as the U.S. extended exemptions for tariffs on some Chinese goods, including solar manufacturing equipment, that U.S. industries rely on for their own production. The U.S. Trade Representative extended those exemptions, which were due to expire on May 31, by three months through Aug. 31. Still, China criticized the U.S. on Monday over moves it alleged harmed Chinese interests, including issuing AI chip export control guidelines, stopping the sale of chip design software to China, and planning to revoke Chinese student visas. Hong Kong's Hang Seng gained 1.1% to 23,417.39, while the Shanghai Composite index added 0.3% to 3,356.36. In Tokyo, the Nikkei 225 advanced 0.6% to 37,683.19. South Korean markets were closed for a snap presidential election triggered by the ouster of Yoon Suk Yeol, a conservative who now faces an explosive trial on rebellion charges over his short-lived imposition of martial law in December. Australia's S&P/ASX 200 was up 0.7% to 8,475.50. In Taiwan, the Taiex gained 1.4%. On Monday, U.S. stock indexes drifted closer to their records following a stellar May, Wall Street's best month since 2023. The S&P 500 rose 0.4% to 5,935.94 after erasing an early loss from the morning. The Dow Jones Industrial Average added 0.1% to 42,305.48. The Nasdaq composite climbed 0.7% to 19,242.61. Indexes had fallen close to 1% in the morning following some discouraging updates on U.S. manufacturing. President Donald Trump has been warning that U.S. businesses and households could feel some pain as he tries to use tariffs to bring more manufacturing jobs back to the country, and their on-and-off rollout has created lots of uncertainty. But stocks rallied back as the day progressed. Nvidia climbed 1.7%, and Meta Platforms rose 3.6%, for example. Oil prices have gained as attacks by Ukraine in Russia raise uncertainty about the flow of oil and gas around the world. Early Tuesday, U.S. benchmark crude oil was up 62 cents at $63.14 per barrel. Brent crude, the international standard, picked up 57 cents to $65.19 per barrel. Markets took in stride fresh salvos between the world's two largest economies, just a few weeks after the United States and China had agreed to pause many of their tariffs that had threatened to drag the economy into a recession. That followed President Donald Trump's accusation at the end of last week, where he said China was not living up to its end of the agreement that paused their tariffs against each other. Trump on Friday told Pennsylvania steelworkers he's doubling the tariff on steel imports to 50% to protect their industry, a dramatic increase that could further push up prices for a metal used to make housing, autos and other goods. That helped stocks of U.S. steelmakers climb. Nucor jumped 10.1%, and Steel Dynamics rallied 10.3%. On the losing side of Wall Street were automakers and other heavy users of steel and aluminum. Ford fell 3.9%, and General Motors reversed by 3.9%. Lyra Therapeutics soared nearly 311% for one of the market's biggest gains after reporting positive late-stage trial results of an implant to treat chronic sinus inflammation in some patients. In the bond market, Treasury yields rose as worries continue about how much debt the U.S. government will pile on due to plans to cut taxes and increase the deficit. The yield on the 10-year Treasury climbed to 4.44% from 4.41% late Friday and from just 4.01% roughly two months ago. That's a notable move for the bond market. Besides making it more expensive for U.S. households and businesses to borrow money, such increases in Treasury yields can deter investors from paying high prices for stocks and other investments. Yields had dipped briefly in the morning, before rallying back, following the updates on manufacturing, which suggested that effects of Trump's tariffs are taking root in the economy. A report from S&P Global on manufacturing came in better than expected, though uncertainty caused by tariffs has worries high about supplier delays and rising prices. Also early Tuesday, the dollar rose to 143.10 Japanese yen from 142.71 yen. The euro slipped to $1.1438 from $1.1443.
Globe and Mail
3 hours ago
- Globe and Mail
This ETF Could Turn $500 Per Month Into a $851,000 Portfolio Paying $30,000 in Annual Dividend Income
Many investors aspire to build a portfolio that can pay them enough in dividends to fund their retirement goals. If you can find stocks that consistently raise their dividends, typically offsetting the impact of inflation and then some, you could find yourself in the enviable position where you can leave your principal investment untouched. Instead, you get to live off your dividends and pass along your stocks to your heirs or donate them to charity. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » But building a portfolio of high-quality dividend stocks isn't easy. Fortunately, there's one exchange-traded fund (ETF) that can take care of it for you. And if you invest early and consistently until retirement, you could end up with a portfolio worth over $850,000 that pays out around $30,000 in annual dividends. The best dividend ETF on the market Two simple factors that can help investors find companies that are likely to raise their dividends in the future are management's history of dividend increases and the company's financial health. If management has consistently increased the dividend and has the financial ability to keep doing so, it's very likely to continue the streak. That's why the Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) is an effective way to invest in high-yield dividend growth stocks. The index fund follows the Dow Jones U.S. Dividend 100 Index, which selects 100 stocks that have each increased their dividend annually for at least 10 consecutive years. It ranks each eligible company by several criteria: the ratio of free cash flow to debt, return on equity, dividend yield, and dividend growth rate. The top 100 companies (based on a composite ranking of all four criteria) are included in the index and weighted by market cap. As of this writing, the 10 largest companies (and their dividend yields) in the index are as follows: Coca-Cola (2.8%) Verizon Communications (6.2%) Altria (6.8%) Cisco Systems (2.6%) Lockheed Martin (2.8%) ConocoPhillips (3.7%) Home Depot (2.5%) Chevron (5.1%) Texas Instruments (3%) Abbvie (3.6%) As you can see, you get a mix of high-yield dividend stocks along with stocks that have strong growth supporting future payout increases. The result is a combined yield of about 4% based on trailing-12-month distributions from the ETF. But the forward yield should be even higher considering most constituents will pay out more over the next year than the previous year. With an expense ratio of just 0.06%, the cost of investing in this ETF is low and in line with some of the most popular index funds on the market. The Dow Jones dividend index's decision to weight constituents by market cap (with a 4% weight limit) makes it a very efficient index to track, and it lowers the risk tied to any high-yield stocks that aren't as fundamentally sound as the screener suggests. If the market bids down the value of those stocks, they will comprise a lower percentage of the index over time, while the high-quality businesses rise to the top. How $500 per month can turn into $30,000 in annual dividends Consistently investing $500 per month into the Schwab U.S. Dividend Equity ETF will eventually produce a sizable portfolio. Automatically reinvesting the quarterly distribution from the ETF will ensure a good total return on your investments as you accumulate shares over time. Since its inception in 2011, the fund has produced an annualized total return of 12.2%. That's an exceptional performance, but it's also worth pointing out the S&P 500 index has beaten the ETF with an annualized total return of 14.5%. The gap between the two has widened recently due to the outperformance of growth stocks since 2023. Historically, the S&P 500 averages returns around 10% per year, and 9% is more appropriate as a conservative estimate of the ETF's annual total return. The ETF's 4% distribution yield is also relatively high, but it may come down over time as the Federal Reserve lowers interest rates. That said, there's no telling what prevailing interest rates will be well into the future. A 3.5% yield is a reasonable estimate for the ETF's future yield. With those assumptions in mind, here's how a $500 monthly investment in the Schwab U.S. Dividend Equity ETF could grow over time if you automatically reinvest dividends. Years Investing Portfolio Value Forward Dividend Payment 1 $6,245 $219 5 $37,368 $1,308 10 $94,862 $3,320 15 $183,323 $6,416 20 $319,431 $11,180 25 $528,851 $18,510 30 $851,070 $29,787 Calculations by author. There are a few important caveats to the above scenario. First of all, it's based on forecasts for expected returns and dividend yields that could be well off the mark. More importantly, those returns won't be linear over time. The market is full of ups and downs. The sequence and size of those ups and downs could have a tremendous impact on the final result of your investments. That said, the longer your holding period, the more likely your results will look like the table above. Another important consideration is the impact of inflation: $30,000 won't have the same buying power in 30 years as it has today. That means investors will have to adjust their expectations or strategy if they want future purchasing power equivalent to $30,000 today. That could mean consistently increasing the monthly contribution, for example. While your actual results may vary from the above table, the key takeaway for most investors is to get started and remain consistent. The Schwab U.S. Dividend Equity ETF is a great option if you seek dividend growth and income in retirement. Should you invest $1,000 in Schwab U.S. Dividend Equity ETF right now? Before you buy stock in Schwab U.S. Dividend Equity ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Schwab U.S. Dividend Equity ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $828,224!* Now, it's worth noting Stock Advisor 's total average return is979% — a market-crushing outperformance compared to171%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 2, 2025
