Rigetti Computing’s Bullish Analyst Note Fails to Rally Skeptical Market

A stark disconnect between Wall Street optimism and investor sentiment was on display last Friday as shares of quantum computing firm Rigetti Computing declined despite a bullish initiation report. Mizuho Securities began coverage with a $50 price target, implying a 91% upside from current levels. Instead of advancing, the equity fell 3.87% to close at $25.84, highlighting the credibility challenges facing the company and the sector's current volatility.

Mizuho's "Outperform" rating hinges on Rigetti's ambitious technological timeline, which targets surpassing 100 qubits by the end of 2025 and more than 1,000 qubits by 2027. However, the market's focus shifted immediately to the company's present financial health. Third-quarter revenue came in at just $1.95 million, an 18% year-over-year decrease. This stands in sharp contrast to GAAP net losses exceeding $200 million for the period, which included non-cash items.

While Rigetti reported a substantial cash position of $558.9 million as of September 30, 2025, its high cash burn rate is causing concern. Comparisons with sector peers intensified the selling pressure. Competitor D-Wave Quantum reported 100% revenue growth for its third quarter. Market commentators on platforms like Seeking Alpha even suggested a pair-trade strategy on Friday: going long on IonQ while shorting Rigetti. Their thesis points to IonQ's superior cash-to-market capitalization ratio and better manufacturing scalability.

Sector-Wide Correction Adds Pressure

The broader market context is working against Rigetti. Following a 300% rally over the preceding twelve months, the stock is now in a consolidation phase. The broader market's Fear & Greed Index reading of 39 signals "Fear," and Rigetti's shares remain far below their 52-week high of $58.15.

Should investors sell immediately? Or is it worth buying Rigetti?

Options market activity on Friday confirmed the cautious stance. The put-call distribution shifted in favor of protective puts, indicating traders are hedging against further downside. This defensive positioning is occurring despite—or perhaps because of—the bullish analyst stance.

Key Investor Concerns:
* An 18% year-over-year decline in quarterly revenue
* Significant net losses despite a large cash reserve
* Technical hurdles associated with superconducting qubits
* Intensifying competition from players like D-Wave and IonQ

The Path Forward: Execution is Everything

From a technical analysis perspective, Friday's closing price landed well below the 50-day moving average of approximately $34.97, a near-term bearish signal. The stock tested but narrowly held support at the $25 level.

All eyes are now on the execution of Novera system sales. Confirmed orders worth $5.7 million are scheduled for delivery in the first half of 2026. Until the company's financial performance begins to align with its technological promises, Rigetti's shares will likely remain susceptible to sharp sentiment shifts. Mizuho's $50 price target now places additional pressure on management to bridge the widening gap between potential and delivered results.