D-Wave Stock: 71% Potential Upside, but is it Enough to Buy QBTS Now?

D-Wave Quantum QBTS has gained just 0.6% since its Aug. 6 second-quarter earnings report, trailing IonQ IONQ, Rigetti RGTI and the S&P 500, as investors appear to be prioritizing near-term financial execution over D-Wave’s long-term technology milestones. The disconnect is evident in the company’s second-quarter revenues, essentially flat year over year and 19.5% below the Zacks Consensus Estimate, while adjusted EBITDA loss widened to $37.1 million.

More importantly, second-quarter bookings were only $2.1 million after a $33.4 million first-quarter haul, indicating the lumpiness of demand despite first-half bookings surging 1,120% to $35.5 million.

Stock Comparison Since QBTS’ Q2 Earnings Announcement

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Still, the outlook is improving with $40.7 million of RPO, 57% expected to convert within 12 months, two system deliveries planned for 2026, and production applications already generating 37.3% of first-half QCaaS revenues, providing potential catalysts.

Meanwhile, stronger U.S. policy support for quantum commercialization and domestic supply chains adds a favorable backdrop. The key near-term test is whether bookings convert into revenue and commercial deployments fast enough to justify elevated spending.

Q3 & 2026 Revenue, EPS Estimates

The Zacks Consensus Estimate for the third quarter of 2026 is pegged at $3.95 million, a 5.7% improvement over the year-ago reported number, with a loss per share expectation of 7 cents (narrower than the year-ago 41 cents of loss), suggesting that the impact of D-Wave’s strong bookings is unlikely to be fully reflected in the near-term results.

For full-year 2026, the Zacks Consensus Estimate for revenue is pegged at $38.63 million, a 57.1% improvement over the 2025 reported number. The projected EPS loss narrows to 28 cents from $1.11 in 2025. The estimates therefore place considerable weight on second-half execution, particularly the conversion of bookings, RPO and planned system deliveries into recognized revenue.

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Technical Analysis

Going by the technical picture, QBTS trades below both its 50-day and 200-day simple moving averages (SMAs). Moreover, the 50-day average remains below the 200-day average, offering no strong technical confirmation of a potential trend reversal. The chart indicates that the market remains cautious despite D-Wave’s improving bookings, RPO and commercial pipeline.

50-200-Day SMAs

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Lofty Valuation

Despite its commercial momentum, QBTS continues to trade at a lofty valuation relative to its current revenue base. The stock is currently trading at a 12-month Price/Sales ratio of 110.17X, compared with approximately 5X for the S&P 500. Its three-year median P/S ratio stands at 87.89X, also well below the current multiple. This implies that the stock already carries substantial growth expectations, leaving limited room for execution disappointments.

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But Price Target is High

With the short-term average price target of $35.79 implying 71.49% upside from the last close of $20.87, the consensus suggests that, despite the stock’s recent weakness and elevated valuation, analysts see substantial room for appreciation as D-Wave converts its strong bookings and commercial pipeline into revenue growth.

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Why Hold QBTS Now

Investors may prefer to hold QBTS rather than book profits or initiate fresh positions, as the stock’s strong commercial pipeline and 71% analyst-implied upside offer meaningful potential, while its lofty valuation and weak technical setup warrant caution. The company’s ability to convert bookings into revenue remains the key catalyst. Accordingly, Zacks Rank #3 (Hold) supports a wait-and-watch approach until execution improves. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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