A conceptual image of a processor representing quantum computing.  IONQ title

Top 3 Most Underrated Quantum Computing Stocks to Buy Now: July 2023

Quantum computing emerges as a key frontier as the technology landscape continually evolves. This article focuses on three underrated quantum computing stocks, each with growth potential. Despite their underestimation, these pioneers are making leaps and bounds in quantum technology, setting the stage for a potential surge in stock prices.

Going forward, we’ll delve into these underrated quantum computing stocks. Each company boasts a unique narrative within the quantum computing industry, armed with distinct strategies and offerings. We aim to provide a short investment thesis for each, giving you the information you need for informed decision making. So, stay with us as we unveil the promising potential of these titles in the exciting world of quantum computing.

IonQ (IONQ)

A conceptual image of a processor representing quantum computing.  IONQ title

Source: Amin Van/Shutterstock.com

IonQ (NYSE:IONQ extension) strong growth and partnerships with leading technology companies such as Amazonia (NASDAQ:AMZ extension) make it an attractive investment. Despite the recent volatility, the company’s positive outlook and rising bookings suggest a promising future.

The company announced the availability of its quantum computer, the IonQ Aria, on Amazon Web Services (AWS) in May of this year. This addition to AWS’s quantum computing service, Amazon Braket, expands IonQ’s existing presence on the platform following the debut of IonQ’s Harmony system in 2020. IonQ Aria, with its 25 algorithmic qubits, allows users to run more complex quantum algorithms to tackle complex problems.

The expansion of IonQ’s ecosystem with its partnership makes it an underrated quantum computing stock to consider. The performance of IONQ stock also makes it a momentum play. It’s up more than 330% year-to-date, and its sales have grown 115% quarter-over-quarter.

Microsoft (MSFT)

In this photo you can see the Microsoft Office 365 logo on the screen of a smartphone and a PC.  Stock AVPT, AVPT provides services for Microsoft products (MSFT).

Source: rafapress/Shutterstock.com

Microsoft (NASDAQ:MSFT extension) is doing well, but I’d still rate it as one of the underrated quantum computing stocks. This is mainly due to its competitive positioning and the way it leverages quantum technology. Simply put, its application of topological qubits is seen as a high-risk, high-reward venture. At the same time, other companies like IonQ are building less experimental but perhaps less effective quantum systems.

Some theorize that Microsoft’s quantum approach will lead to lower fault tolerance and ultimately faster time-to-market for a commercial quantum computer. It should be noted that this is firmly in the realm of speculation, as MSFT’s approach has yet to be conclusively proven. But it has made significant progress in its R&D efforts, which suggests it’s definitely on the right track.

MSFT is also benefiting from the rise of generative AI with its subscription service for its Office suite of products. This led the company to a new all-time high in July.

Quantum Computing Inc (QUBT)

Source: Bartlomiej K. Wroblewski / Shutterstock.com

Quantum Computing Inc (NASDAQ:QUBT extension) offers a unique opportunity to invest in a smaller niche player in the field of quantum computing. The company’s focus on hardware and software development could position it well for future growth in the quantum computing market.

QUBT is a penny stock with a market cap of $90 million. However, he has big plans for the future. Its flagship product is the Reservoir Computer, a compact hardware device designed to make neuromorphic hardware accessible and affordable. Neuromorphic computing differs from quantum in that it attempts to mirror how neurons and synapses function in a human brain. The benefit is that it allows AI models to learn in parallel, rather than sequentially in traditional computation, allowing them to better perform tasks such as pattern recognition.

We may see an arms race between neuromorphic and quantum computing as the de facto standard. In a small way, this could be compared to the race between HD DVD and Blu-ray discs. Both situations involve competing technologies competing to become the dominant standard in their respective fields. While quantum and neuromorphic hardware technologies aren’t direct competitors, from an investor’s perspective it might be worth diversifying into either form of technology since we don’t know which will be better until later.

As of the date of publication, Matthew Farley did not hold (directly or indirectly) any positions in the securities referenced in this article. Opinions expressed are those of the writer, subject to InvestorPlace.com posting guidelines.

Matthew began reporting on the financial markets during the cryptocurrency boom of 2017 and has also been a team member of several fintech startups. He then began writing about Australian and US stocks for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and New Scientist magazine, among others.

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