InvestorPlace: Three Quantum Computing Stocks to Buy for Their Promising Healthcare Potential
(InvestorPlace) Quantum computing stocks are gaining traction as this once-nascent industry is fast evolving. Wall Street is paying increased attention to the segment as companies move from the experimental research phase to developing commercially feasible computers that can solve the world’s most complex problems and revolutionize businesses in many industries.
Quantum computers are expected to have a significant impact across a wide range of industries. Therefore, I want to introduce three quantum computing stocks to invest in the rest of this year. Let’s take a look at three of the top quantum computing stocks on the market right now.
Defiance Quantum ETF (NYSEARCA:QTUM)
International Business Machines (NYSE:IBM)
Microsoft (NASDAQ:MSFT)
A closer look at each recommendation:
Defiance Quantum ETF. It invests in global businesses that are leading the technology and applications behind quantum computing, cloud platforms, machine learning, as well as other advanced computing technologies.
QTUM, which has 71 holdings, tracks the returns of the BlueStar Quantum Computing and Machine Learning Index. The fund was first listed in September 2018.
In terms of subsectors, we see Quantum Computing Technology (35.56%), followed by Machine Learning Services (21.44%), AI Chips (17.67%), GPU & Other Hardware (13.07%) and Big Data & Cloud Computing (9.39%). Close to 60% of the companies are U.S.-based. Others come from Japan (12.64%), the Netherlands (8.39%), Taiwan (4.11%) among others.
Year-to-date, QTUM is up more than 25% and hit a record high in recent days. As the fund’s holdings show, there are not many pure-play quantum computing stocks.
International Business Machines (IBM)
IBM generates revenue from five segments namely cloud and cognitive software, global business services, global technology services, systems and global financing. The company announced second quarter financial figures at the end of July. Revenue was $18.7 billion implying 3% year-over-year (YOY) growth. Net income of $1.3 million meant a decline of 3% YOY. Diluted non-GAAP earnings per share (EPS) was $2.33. A year ago, it had been $2.18. Meanwhile, net cash from operating activities stood at $17.7 billion.
Management believes quantum computing will play a key role in healthcare as it could “enable a range of disruptive use cases for providers and health plans by accelerating diagnoses, personalizing medicine, and optimizing pricing. Quantum-enhanced machine learning algorithms are particularly relevant to the sector.”
Microsoft (MSFT
Tech giant Microsoft, which generates revenue from three segments namely Productivity and Business Processes (such as Office 365 and LinkedIn) , Intelligent Cloud (Azure, Premier Support Services, and Consulting Services) and More Personal Computing (Windows Commercial, Bing, and Xbox).
Microsoft highlights, “From breakthroughs in physics and nanomaterials to seamless integration with Microsoft Azure, Microsoft is leading the way to scalable, accessible quantum computing.” For example, analysts have been pointing out how Microsoft’s quantum technology could influence the power industry, healthecare privacy, and personalized medicine.
