The 3 Most Undervalued Quantum Computing Stocks to Buy: October 2023

Stocks to buy

The impending release of the third-quarter gross domestic product (GDP) report by the Commerce Department holds significant benefits for the United States economy. A robust economic expansion leads to increased consumer spending, business investments and job creation. This, in turn, tends to boost overall stock market performance, which benefits sectors especially quantum computing. Quantum computing stocks, representing cutting-edge technology with transformative potential, will experience increased investment in research and development as the economy grows. This inspired us to create this list of quantum computing stocks to buy.

These three quantum computing stocks to buy are undervalued and are great buys for October.

Quantum Computing Stocks to Buy: Rigetti Computing (RGTI)

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Rigetti Computing (NASDAQ:RGTI) is an American-based company for integrated systems, constructing quantum computers and superconducting quantum processors. RGTI stock has grown 59.43% YTD.

The quantum computing industry displayed confident outlooks in 2022, bringing in $717.3 million with projections for 2023 to reach $928.8 million. Furthermore, the industry as a whole has been rapidly growing. There were forecasts of 2030 reaching $6.5 billion, marking a CAGR of 32.1% during this seven-year period.

Financially, Rigetti Computing showed strong promises of growth in Q2 of 2023 through a high revenue of $3.33 million which grew 55.9% YoY. The company also beat consensus earnings estimates by 20.89% on revenue. However, net income dipped to -$16.97 million. However, this is mainly due to to the increased costs of developing its first quantum processing units. As sales increase, the company projects income to cover expenses in the upcoming fiscal years.

Ultimately, the largest factor behind Rigetti Computing’s growth has been the development of its quantum processing units. Recently, Rigetti Computing announced a nine-qubit QPU, which is expected to outperform other competitors at the same processing power. Furthermore, its upgraded Ankaa-2 system, the sequel to its successful Ankaa-1 system, is projected to be released in Q4 2023. Expect major upgrades to be announced in upcoming investor relations conferences. Projections are speculated for increased processing power building on top of the Ankaa-1 system.

Aehr Test Systems (AEHR)

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Aehr Test Systems (NASDAQ:AEHR) is a provider of test solutions for burning in and stabilizing semiconductor devices. 

The stock is up 70.69% YTD. The global semiconductor market size was $527.88 billion in 2021 and is projected to grow from $573.44 billion in 2022 to $1,380.79 billion in 2029. This is exhibiting a CAGR of 12.2% during the forecast period. This growth is due to the increasing consumption of consumer electronics devices across the globe. 

Aehr Test’s revenue outlook is strong. Furether more, in Q3 2023, the company reported $20.62 million in revenue. This indicates signs of the company being undervalued. Further financial growth is evident through a 22.66% net profit margin, which grew 310.51% YoY, and income of $4.67 billion, growing 693.55% YoY. 

Aehr Test has been on a downward spiral lately with significant selling pressure. It experienced a decline of 25.9% last month. However, it is very likely for the trend for the stock to minimalize and return for primed growth, as indicated by its RSI reading of 27. This implies Aehr Test will effectively reach the old equilibrium of supply and demand following the coverage of short-term issues. In addition, there has been strong agreement among the sell-side analysts covering the stock in raising earnings estimates for the current year. The consensus EPS projected for AEHR has increased by 3.2% throughout the last 30 days. The price appreciation in the near term is estimated to take place due to an upward trend in earnings estimate revisions. 

Yahoo! Finance reports an analyst with a 12-month price target of $60.00. AEHR looks oversold, and there is strong growth potential leading into the end of this year. All in all, if you are looking for quantum computing stocks to buy, this is a great place to start.

Snow Lake Resources  (LITM)

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Snow Lake Resources (NASDAQ:LITM) is a Canadian lithium development company. The company has two hard rock lithium projects in the Snow Lake region of Northern Manitoba. LITM focuses on advancing the Snow Lake Lithium Project through subsequent phases of development and production to supply the North American EV and energy storage markets.

LITM stock is down around 58.48% to $0.95 in the past year. This places itself in an attractive position for investors. The global lithium mining market size is projected to grow from $343.22 million in 2021 to $516.22 million by 2028 from a 6% CAGR from 2021 to 2028.

Snow Lake boasts strong financials. Cash and short-term investments YoY increased 7,362.08% to $23.79 million. Total assets grew 505.56% YoY to $37.11 million. Additionally, cash from financing has increased by 3,919.32% to $32.55 million. Net change in cash grew to $23.47, showing confidence and stability in the financials of LITM.

In early October, Snow Lake announced that it entered an agreement with Critical Discoveries. These industry-dominant companies will collaborate to both advance the exploration and development of the Snow Lake Lithium Project and to expand Snow Lake’s portfolio of prospective lithium projects in Manitoba and the surrounding region.

On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.

Michael Que is a financial writer with extensive experience in the technology industry, with his work featured on Seeking Alpha, Benzinga and MSN Money. He is the owner of Que Capital, a research firm that combines fundamental analysis with ESG factors to pick the best sustainable long-term investments.

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