Can IonQ stocks help you become a millionaire?

IonQ (NYSE: IONQ)It's been a volatile stock since its IPO, and there's been a lot of talk about it. The quantum computing services provider went public on October 1, 2021, in conjunction with a special-purpose acquisition company (SPAC), and its shares started at $10.60 and nearly tripled on November 17, 2021, to a record high of $31.

Today, however, IonQ's share price is about $8. It's lost its luster because it hasn't lived up to its name, its co-founder and chief scientist resonance Chris Monroe has stepped down, and rising interest rates have burst its bubble-like valuation. Can this out-of-favor tech stock bounce back and create some new millionaires over the next decade?

What does IonQ do?

While conventional computers process data into binary "bits" made up of 0s and 1s, quantum computers can process both 0s and 1s into "quantum bits". This approach makes quantum computers much faster than conventional computers, but they are also larger, more expensive, and more prone to errors when processing large amounts of data.

IonQ aims to solve these problems with its "tachyon" technology, which reduces the average width of a quantum bit processing unit (QPU) system from a few feet to a few inches. The company believes that this miniaturization process will make quantum computing systems more scalable, less expensive and more accurate.

As it develops its miniaturized technology, IonQ is offering its quantum computing power as a cloud service to the U.S. military and large corporate customers. It measures its total quantum computing power in Algorithmic Quantum Bits (AQ), reaching AQ 29 in 2023, AQ 36 in January of this year, and AQ 64 by 2025.

IonQ claims that at AQ 64, its platform will be "100,000 times larger than the limits of classical supercomputer simulations." In its latest investor presentation, IonQ also reiterated its goals of reaching AQ 256 by 2026, AQ 384 by 2027, and AQ 1,024 by 2028.

Why did IonQ disappoint the bulls?

This growth trajectory sounds incredible, but IonQ has failed to meet its own revenue expectations. Prior to the IPO, IonQ claimed that its revenue would reach $5 million by 2021, $15 million by 2022, and $34 million by 2023.

In reality, however, IonQ's revenues will only reach $2 million in 2021, $11 million in 2022, and $22 million in 2023. It expects 2024 revenues to reach $37 million to $41 million.

In 2022, prolific short seller Scorpion Capital accused IonQ of overstating its miniaturization capabilities by secretly using theHoneywellIonQ's quantum computers are used to process its cloud-based processing services. A few months later, Chris Monroe, who developed the sleepy ion technology on which IonQ's entire business strategy depended, abruptly resigned. These setbacks prompted some of IonQ's investors to file a class action lawsuit against the company. IonQ won the case last October, but it still faces serious questions about its future.

IonQ is still grossly unprofitable, and its shares are expensive at 45 times this year's sales. But looking ahead, analysts expect its revenues to grow at a staggering 91% compound annual growth rate (CAGR) from 2023 to 2026.

Will IonQ become a Millionaire Stock?

If IonQ meets these expectations, it will generate $153 million in revenue by 2026. Assuming it still trades at 45 times forward sales, its stock price would more than quadruple by early 2026, giving it a market capitalization of $6.9 billion.

If it continues to grow at a compound annual growth rate of 30% from 2026 to 2034, it will generate $1.1 billion in revenues by the final year. If it trades at a more reasonable 20 times sales by then, it would be worth $22 billion-an increase of nearly 1,200TP3T over current prices. this gain could turn a $77,000 investment into $1 million in 10 years.

This growth trajectory is feasible-as Acumen Research and Consulting estimates that the quantum computing market will grow at a compound annual growth rate of 36% from 2023 to 2032-but IonQ will need to demonstrate that its business model is sustainable over the next few years. In the growing quantum computing market, it will also need to fend off competition fromIBMrespond in singingAlphabetof fierce competition from tech giants such as Google.

IonQ is on a narrow but viable path to generating millionaire earnings, but it remains a highly speculative stock. Investors should be aware that in this volatile market, IonQ's stock price could be cut in half before it rises significantly.

Should you invest $1,000 in IonQ now?

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Alphabet executive Suzanne Frey is a member of The Motley Fool's Board of Directors. leo Sun has no position in any of the stocks mentioned above. the Motley Fool has a holding in Alphabet. the Motley Fool recommends International Business Machines Corporation. the Motley Fool has a disclosure policy.

Can IonQ Stocks Help You Become a Millionaire? This post was originally published by The Motley Fool.