An analyst has advised avoiding shares of Quantum Rigetti. What is he unhappy about?

Investors should avoid Rigetti Computing, a quantum computing stock, or buy it only for speculative purposes, says Motley Fool freelance analyst Will Healy. The company needs to improve its financial position first, he explains.

Investors should not buy Rigetti stock because of its difficult financial position, says Motley Fool freelance analyst Will Healy.

In 2025, the company's revenue fell 35% to $7 million amid the suspension of the renewal of one of its government contracts and a delay in the release of its new Cepheus-1-108Q quantum system, Healy explains. Rigetti had planned to start selling it in late 2025, but said in January 2026 that it was delayed because more time was needed to improve the system's accuracy. As a result, its sales did not begin until April.

The company has high operating expenses, leading to a 7.6% increase in net loss in 2025 to $216.2 million, the Motley Fool analyst continued.

Investor optimism may be spurred by Wall Street's favorable outlook for the company's revenue: analysts expect it to grow 219% in 2026 and 103% in 2027, Healy argues. But that's unlikely to translate into a profitable business or at least positive free cash flow, according to the Motley Fool article.

Healy also draws investors' attention to the dynamics of shares in 2025: in October they were 2.8 times more expensive than at the beginning of the year. At that time one of the drivers of quotes growth was the report of The Wall Street Journal that the U.S. government is negotiating the acquisition of stakes in several quantum companies in exchange for federal funding. By the end of December Rigetti securities lost almost all the gained growth, including due to postponement of the release of a new quantum system. In April, when the company announced its launch, quotations jumped again.

The analyst concludes that the dynamics of quotations is largely influenced by investors' moods, which makes the securities speculative. Therefore, Healy advises investors to avoid Rigetti securities for the time being or buy them only for speculative purposes.

Rigetti is building quantum computers. It is taking a unique approach by combining multiple chiplets instead of trying to make one large monolithic chip with more processing power, Healy writes.

In April, the company announced the Cepheus-1-108Q system, which it calls the largest in the industry and the most powerful in its lineup in terms of the number of qubits - which is the smallest unit of information in a quantum computer. After refinements, the accuracy of two-qubit gates - a measure of computing quality - is 99.1%, and the company plans to increase it to 99.5% by the end of the year, Rigetti reported.

Since the beginning of the year, Rigetti's stock has fallen 25% to $16.6 per share.

Wall Street is positive about the company's prospects: its securities have ten "buy" ratings from analysts, three - "hold" and only one - "sell". The average target price is $31, which means the potential growth of almost 87% to the value of the securities at the close of trading on April 24.