Quantum Computing: Irrational Exuberance (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• I am usually positive on Seeking Alpha stocks rated a 'Strong Buy', given the Quant Rating system's long term record in beating the S&P500. But I thinkQUBT is an exception.
• Despite a $3 billion market capitalization, TTM revenues are tiny at only $400,000. The hype around the NASA deal is unjustified as it is only worth $26,163.
• QUBT is bleeding money and has been saved by a $90 million raise in the last 2 months, management has made questionable capital allocation choices and directors seem overpaid.
• Valuations indicate irrational exuberance at MCAP/TBV of 32x. Technicals look bullish but the hype-based euphoria is likely to reverse sharply.
• Amusingly, the company's origins are in a completely different industry; it made a huge pivot from beverages to quantum computing back in 2018.

Read the full article here.