IonQ Is Ripping Higher Today — Is the Stock a Buy Right Now?

IonQ (IONQ +18.23%) stock is seeing another day of huge gains in Wednesday’s trading. The company’s share price was up 18% as of 1:45 p.m. ET.

IonQ’s valuation is surging higher today thanks to news that Nvidia is releasing a new family of open source artificial intelligence (AI) models to support quantum-computing technologies. Nvidia’s Ising models have been created to help researchers and enterprises build useful quantum processors, and companies across the quantum-computing industry are seeing big gains today in conjunction with the news. IonQ’s big rally today comes on the heels of a 20.2% gain for the stock in yesterday’s trading propelled by news that the company had signed a new partnership with the U.S. Defense Advanced Research Projects Agency (DARPA).

Is IonQ stock a buy right now?

In conjunction with the World Quantum Day event that took place on April 14, IonQ has seen some bullish news stories recently. Signs that Nvidia will continue to support development in the quantum space represent a meaningful vote of confidence from the most influential player in the AI industry. Meanwhile, IonQ’s partnership with DARPA and recent announcement that it has demonstrated that two quantum-computing systems can be linked together actually look even more promising on a business-specific level.

While IonQ looks to be one of the stronger players in the quantum industry, the stock won’t be a good fit for every investor. With a market capitalization of roughly $15.5 billion, the company is valued at approximately 66 times this year’s expected sales — and its path to regular profitability and earnings growth remains speculative.

IonQ has a shot at being a huge winner over the long term, but it’s also a very risky bet. With that in mind, I think that all but the most bullish and risk-tolerant quantum investors should wait for a pullback before buying heavily into the stock.