IonQ, Inc. (IONQ): A Bull Case Theory

We came across a bullish thesis on IonQ, Inc. on Investing With Purpose’s Substack. In this article, we will summarize the bulls’ thesis on IONQ. IonQ, Inc.'s share was trading at $66.81 as of September 18th.

IonQ (IONQ) is making a deliberate bet on the commercial viability of quantum computing within this decade, positioning itself to be among the first to scale the technology. The company is deliberately unprofitable today, investing heavily in trapped-ion quantum processors, systems integration, and intellectual property to secure a leadership position, attracting interest from Amazon, Microsoft, and U.S. defense agencies.

Revenue grew 95% YoY to $43 million, and with roughly $340 million in cash and zero long-term debt, IonQ has the runway to fund R&D for several years. Despite this, the business model remains highly speculative, with net margins of -770%, free cash flow margins of -287%, and SG&A at 545% of revenue. Most revenue comes from experimental use cases and government partnerships, as quantum computing is still far from scalable for enterprise adoption, and profitability is not expected through 2027.

Valuation reflects this speculation, with a price-to-sales ratio of 206x and EV/EBITDA of -42x, pricing in commercial dominance that has yet to materialize. Technically, the stock appears to be peaking at the top of a corrective rally, completing a five-wave impulse and an ABC correction, with key resistance near $47–$49 and support at $44.75. Failure to hold this support could trigger a deeper wave toward $34 or lower, while a breakout above $49.90 could signal a renewed upward impulse, potentially targeting $54–$58 if driven by breakthroughs or partnerships.

For traders, this setup may offer short-term opportunities, while medium- to long-term investors should exercise caution, recognizing IonQ as a vision trade rather than a value investment. The risk-reward remains skewed, with substantial upside possible if quantum technology scales commercially, but downside is significant until clearer proof of progress or profitability emerges.

Previously we covered a bullish thesis on IonQ, Inc. (IONQ) by Maestroszq in October 2024, which highlighted the company’s rapid revenue growth, patent portfolio, and scalable quantum hardware as key drivers. The stock has appreciated approximately 516% since coverage, as the thesis played out with rising market recognition. Investing With Purpose shares a similar view but emphasizes speculative fundamentals, high cash burn, and technical risks.

IonQ, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 30 hedge fund portfolios held IONQ at the end of the second quarter which was 28 in the previous quarter. While we acknowledge the potential of IONQ as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.