We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
IONQ Below Key Moving Averages: Buy, Hold or Sell Before Q3 Earnings?
Read MoreHide Full Article
Key Takeaways
IonQ trades below its 50-day and 200-day SMAs, signaling bearish momentum ahead of Q3 earnings.
IonQ expects a 91.6% improvement in Q3 EPS, but estimates worsened from a 22-cent loss to a 30-cent loss.
A $7.5 million Air Force follow-on award supports quantum networking, while analysts see nearly 100% upside.
IonQ (IONQ - Free Report) is showing signs of weakening technical momentum as October draws to a close. As of Oct. 28, the stock traded at $32.43, below its 50-day simple moving average (SMA) of $38.66 and its 200-day SMA of $42.23. The 50-day average has also fallen below the 200-day average, forming a bearish crossover that suggests sustained selling pressure and a deteriorating price trend.
For investors, this raises near-term downside concerns, particularly as elevated interest rates continue to put pressure on high-growth technology stocks. The Federal Reserve held its benchmark rate at 3.75%-4% on Oct. 28, while acknowledging persistent inflation risks. However, IonQ’s recent development remains noteworthy. The Air Force Research Laboratory announced a $7.5 million follow-on funding award on Oct. 27. With third-quarter results due Nov. 5, investors will assess whether business progress can help restore market confidence.
IONQ Below 50-to-200 Day SMAs
Image Source: Zacks Investment Research
IonQ Q3 Earnings Estimates and Revisions: What Should Investors Watch?
The Zacks Consensus Estimate for IonQ's third-quarter bottom line is pegged at a loss of 30 cents per share, compared with a loss of $3.58 per share in the year-ago quarter. This reflects an expected 91.6% improvement in EPS. However, earnings estimates have deteriorated in recent months. Over the past 30 days, the loss per share widened from 22 cents to 30 cents per share. This trend warrants attention ahead of the company's Nov. 5 earnings release.
Image Source: Zacks Investment Research
Commercial Progress
IonQ continues to advance its quantum networking and computing initiatives, providing potential long-term growth opportunities despite the stock's weak technical position. On Oct. 27, the company announced $7.5 million in follow-on funding from the Air Force Research Laboratory (AFRL) to expand its quantum networking capabilities. The second phase includes free-space optical links, quantum frequency converters, upgraded networking hardware and automated control software. Importantly, IonQ stated that this funding was contemplated within its previously announced $21.1 million collaboration, rather than being an additional award on top of that amount.
Other recent developments include the opening of a quantum innovation center with the University of Cambridge on Oct. 15 and plans to acquire cybersecurity company Elisity, announced on Oct. 12. These initiatives broaden IonQ's ambitions across quantum research and security, although their ultimate contribution to revenues, profitability and shareholder returns is yet to be demonstrated.
Fed's Latest Rate Decision: Another Headwind for IONQ and Quantum Stocks?
The Federal Reserve's Oct. 28 decision to maintain the federal funds target range at 3.75%-4.00% leaves borrowing costs elevated. The Fed noted that economic activity was expanding at a strong pace while inflation remained elevated.
For high-growth companies such as IonQ, Rigetti Computing (RGTI - Free Report) and D-Wave Quantum (QBTS - Free Report) , the implications extend beyond direct borrowing costs. Higher discount rates can reduce the present value of future cash flows, potentially weighing on investor appetite for speculative technology stocks.
IonQ's stock fell 26.1% over the past month, while Rigetti and D-Wave declined 21.3% and 29%, respectively, over the same period.
30-Day Stock Comparison
Image Source: Zacks Investment Research
Short-term Price Targets Suggest Upside for IONQ
Currently, 13 analysts have an average short-term price target of $65.77 for IonQ, implying 99.61% upside from the last close of $32.95. However, this bullish outlook contrasts with IONQ's bearish technical signals, as the stock trades below both its 50-day and 200-day moving averages.
Image Source: Zacks Investment Research
Should Investors Hold IONQ Ahead of Q3 Earnings?
IonQ’s upcoming Nov. 5 earnings report could be a reason to hold for now, given its progress in quantum networking and government contracts. However, the stock’s weak trend and declining earnings estimates warrant caution. With a Zacks Rank #3 (Hold) and an average analyst price target implying nearly 100% upside, investors may want to wait for the results and management’s outlook before making their next move. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
View the Zacks #1 Rank List
Image: Bigstock
IONQ Below Key Moving Averages: Buy, Hold or Sell Before Q3 Earnings?
Key Takeaways
IonQ (IONQ - Free Report) is showing signs of weakening technical momentum as October draws to a close. As of Oct. 28, the stock traded at $32.43, below its 50-day simple moving average (SMA) of $38.66 and its 200-day SMA of $42.23. The 50-day average has also fallen below the 200-day average, forming a bearish crossover that suggests sustained selling pressure and a deteriorating price trend.
For investors, this raises near-term downside concerns, particularly as elevated interest rates continue to put pressure on high-growth technology stocks. The Federal Reserve held its benchmark rate at 3.75%-4% on Oct. 28, while acknowledging persistent inflation risks. However, IonQ’s recent development remains noteworthy. The Air Force Research Laboratory announced a $7.5 million follow-on funding award on Oct. 27. With third-quarter results due Nov. 5, investors will assess whether business progress can help restore market confidence.
IONQ Below 50-to-200 Day SMAs
Image Source: Zacks Investment Research
IonQ Q3 Earnings Estimates and Revisions: What Should Investors Watch?
The Zacks Consensus Estimate for IonQ's third-quarter bottom line is pegged at a loss of 30 cents per share, compared with a loss of $3.58 per share in the year-ago quarter. This reflects an expected 91.6% improvement in EPS. However, earnings estimates have deteriorated in recent months. Over the past 30 days, the loss per share widened from 22 cents to 30 cents per share. This trend warrants attention ahead of the company's Nov. 5 earnings release.
Image Source: Zacks Investment Research
Commercial Progress
IonQ continues to advance its quantum networking and computing initiatives, providing potential long-term growth opportunities despite the stock's weak technical position. On Oct. 27, the company announced $7.5 million in follow-on funding from the Air Force Research Laboratory (AFRL) to expand its quantum networking capabilities. The second phase includes free-space optical links, quantum frequency converters, upgraded networking hardware and automated control software. Importantly, IonQ stated that this funding was contemplated within its previously announced $21.1 million collaboration, rather than being an additional award on top of that amount.
Other recent developments include the opening of a quantum innovation center with the University of Cambridge on Oct. 15 and plans to acquire cybersecurity company Elisity, announced on Oct. 12. These initiatives broaden IonQ's ambitions across quantum research and security, although their ultimate contribution to revenues, profitability and shareholder returns is yet to be demonstrated.
Fed's Latest Rate Decision: Another Headwind for IONQ and Quantum Stocks?
The Federal Reserve's Oct. 28 decision to maintain the federal funds target range at 3.75%-4.00% leaves borrowing costs elevated. The Fed noted that economic activity was expanding at a strong pace while inflation remained elevated.
For high-growth companies such as IonQ, Rigetti Computing (RGTI - Free Report) and D-Wave Quantum (QBTS - Free Report) , the implications extend beyond direct borrowing costs. Higher discount rates can reduce the present value of future cash flows, potentially weighing on investor appetite for speculative technology stocks.
IonQ's stock fell 26.1% over the past month, while Rigetti and D-Wave declined 21.3% and 29%, respectively, over the same period.
30-Day Stock Comparison
Image Source: Zacks Investment Research
Short-term Price Targets Suggest Upside for IONQ
Currently, 13 analysts have an average short-term price target of $65.77 for IonQ, implying 99.61% upside from the last close of $32.95. However, this bullish outlook contrasts with IONQ's bearish technical signals, as the stock trades below both its 50-day and 200-day moving averages.
Image Source: Zacks Investment Research
Should Investors Hold IONQ Ahead of Q3 Earnings?
IonQ’s upcoming Nov. 5 earnings report could be a reason to hold for now, given its progress in quantum networking and government contracts. However, the stock’s weak trend and declining earnings estimates warrant caution. With a Zacks Rank #3 (Hold) and an average analyst price target implying nearly 100% upside, investors may want to wait for the results and management’s outlook before making their next move. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.