RGTI valuation is improving but still not attractive enough; wait for a better entry point.

Rigetti Computing, a quantum computing company, has signed a letter of intent with the U.S. Department of Commerce to obtain funding of up to $100 million over three years, provided that certain milestones are met.

Of course, the company has set itself ambitious goals of achieving 99.9% qubit gate accuracy within the next two years, while reducing gate speeds to less than 40 nanoseconds.

But in the near term, for 2026, the company is setting a target of approximately 99.5% accuracy for the dual-qubit gateway. Even I cannot understand what these technical specifications mean, but they are very important milestones for the company.

The more you achieve one of these milestones, the more effective you become. This makes it easier for the company to raise the capital needed to achieve the next milestone.

Naturally, the ultimate goal is to achieve a technology with viable commercial prospects, generating hundreds of millions, if not billions, of dollars. So, after all this, does Regetti Computing stock represent a buying opportunity right now?

For Regetti, revenues rose to $15 million in the 12-month period ending in 2023, then fell to $7 million in early 2026 before recovering to $13.35 million in the most recent 12-month period.

Of course, management told investors that this is what would happen. Revenues will be volatile. It will be irregular. The contracts currently signed are mostly with government or research institutions, and these are short-term and limited in duration, so any new contract causes a rise in revenues during certain quarters, and then as the contract ends, revenues decline again.

But this company should be viewed as being in a pre-stable revenue stage. In the early stages, research and development is underway on a technology that may one day become a project generating hundreds of millions, if not billions, of dollars in revenue.

Therefore, when you look at a company like this, cash flow and liquidity position become extremely important. Rigetti Computing is losing large sums of money. But that's understandable, isn't it?

As I mentioned, it is still considered a pre-revenue company, working on developing its ability to generate profits and turn this into a business.

Currently, the cash flow from operations to sales ratio is negative 455%. But it has a large cash reserve in the bank, exceeding $541 million. Rigetti capitalized on the enthusiasm and euphoria surrounding quantum computing stocks early in its life cycle and raised substantial capital from investors.

It now boasts over $541 million in assets, and to put that in context, the company posted an operating loss of just over $28 million in its most recent quarter. If you calculate that annually, say $120 million as operating losses for the entire year, and compare it to $541 million, that means it has enough liquidity for four to five years compared to its operating losses.

Therefore, it has a long timeframe to develop this technology. But more importantly, it needs to achieve milestones. The more substantial the achievement, the easier it will be for it to approach investors to request more capital to gain additional time to reach the next stage.

Therefore, its goals of achieving 99.9% accuracy, reducing gate speeds to 40 nanoseconds, and reaching around 1,000 qubits, are crucial milestones that, if achieved within the next three years as the management team hopes, will allow them to raise more capital to transform it into a sustainable business.

She stated that the euphoria surrounding Rigetti Computing had almost completely subsided. Since the beginning of the year, the stock price has fallen by more than 32%. If you recall, I made a video in late 2025 in which I answered the question: "Should you buy Rigetti Computing stock for 2026?"

And I said no, he doesn't deserve it. The risk-reward ratio was not in your favor, and it was not a good time to buy the stock.

I made that particular video on December 8, 2025. So, I hope you watched that video and didn't buy the stock then, because it dropped by more than 32% in 2026.

So, it turns out that the decision not to buy Rigetti Computing stock for 2026 was the right one. But what about now that the stock has fallen by more than 32%? Has the risk-reward ratio become more attractive?

Well, the company has certainly achieved certain milestones and made significant progress since then. The evaluation process has also become more attractive. In late 2025, Regity Computing's stock was trading at a forward to sales price exceeding 300, wasn't it?

This is a very high valuation, but when you think of the company as an entity that has not yet generated revenue, it is difficult to value it using these market multiples because of the volatility of revenues and because of the company's very early stage.

However, you still have to look at something when evaluating any business, and this is one of the few metrics we have to consider for Rivian. We cannot look at the price-to-cash-flow ratio, and we cannot look at the price-to-earnings ratio because they have no earnings, their cash flows are negative, and their earnings are negative.

But they have some sales, so that's something we can look at when trying to make a decision.

Its price-to-forward sales ratio has fallen significantly. The stock is now trading at about a third of the price it was trading at in late 2025. It is currently trading at a forward price of 114.

So, it is certainly at a more attractive valuation than it was in early 2026 or late 2025.

But, to answer the question, do I think this is an attractive buying opportunity? I would say that it has made great progress, and the rating has certainly become more attractive, but I would say not yet. I would say it's getting close to that.

It is making improvements. Revenues are increasing. They are making progress. They are signing deals with the government to support more research and development, but I will wait for a better opportunity to get in and buy Righetti stock.

We hope they will continue to make great progress. It is a highly innovative technology, and should really only be considered by investors with a very high risk tolerance. I would say that the quantum computing industry falls into the category of the riskiest stocks you can buy.

Therefore, only investors of the type who prefer high risk and high returns should consider it.

I reiterate that I will wait for a better entry point to buy Regietti Computing stock.