Rigetti Computing (RGTI) Might Be a UFO!
"You only get one spaghetti, do not miss your chance to blow cause spaghetti comes once in a lifetime yo."
Wait, we're talking about Rigetti? My mistake! I've been trying to trade this one for a couple days now and finally got it this morning. It's my second helping of quantum computing stocks this week, but my portfolio still has room! First let's talk...
What’s the Word on the Street?
Despite all the tariff uncertainty, the market is moving higher again today with the Russell in the lead. The Administration announced last night a new, currently highest tariff of 50% on Brazil, and Brazil’s President threatened to respond. But that’s all noise right now apparently. The market is too busy blissfully thinking none of this tariff stuff matters. They haven’t done anything yet to slow the economy, so everything is going to be just fine…?
Rigetti Computing (RGTI)
What Is It?
“Rigetti Computing, Inc. provides full-stack quantum computing services. It serves global enterprise, government, and research clients through its Rigetti Quantum Cloud Services platform. The company was founded by Chad Rigetti in 2013 and is headquartered in Berkeley, CA.”
Why Is It a Possible UFO?
Primarily its current share price relative to its fair value and what other option traders expect are the highlights.
What About Recent News?
I wrote a little about recent quantum computing news in my D-Wave Quantum (QBTS) post the other day, but there isn’t much going on in the space at the moment that would cause a major move. Quantum technology is still an up and coming industry, that might be a bit crowded, but RGTI is seen as one of the players with staying power. It has partnerships, cash to spend, and has been around since 2013, which is older than QBITS, having been founded in 2022.
The biggest negative is that there have been 3 informative sells of 1.3M shares within the past three months. I wouldn’t put too much stock into that though. Interesting to note is that RGTI and other quantum stocks are down today while the Russell (small cap index) is up. I would speculate that quantum technology is seen as a longer term play compared to other more proven small cap stocks. And since we’re in a period of increased uncertainty, quantum technology could be even more uncertain.
What’s the Current Price?
The current price of RGTI is hovering around $13.30 (it’s been up and down slightly all day). Despite having been down ~17% this year, the stock has risen ~46% in the past 3 months. Amazingly it’s gone up ~1,1178% in the past year. Writing that is almost unbelievable. I typically avoid stocks that have run up so much, but I decided since it’s still below fair value and a technology that may have greater ubiquity in the future, I would give it a shot.
What’s the Fair Value?
I’d first like to emphasize that fair value is subjective. Many analysts at many banks and institutions rate stocks differently and assign fair value in their own unique way. So, what I like to do is take all the recent fair values since the most recent earnings report and average them. In this case…
Since RGTI’s most recent earnings report on 05/12/2025, it has received only 2 ratings. There’s no need to calculate an average, as both ratings would indicate the fair value might be somewhere around: $15. Both ratings are a buy.
What Do Options Traders Think?
Calls are trading over equidistant puts, which means traders think there is a chance to the upside. You can see because… forget about the green columns and focus on the red. Notice how on the right side for the $10 put it says $0.29, it’s $0.75 for the equidistant call at $17.
The premium (the credit you receive for executing the trade) is currently less for selling puts, as opposed to selling calls. Basically because of that, option traders expect the stock to go up, rather than down.
What’s the Trade?
My preferred trade is a variation of the wheel without the rolling, AKA cash-secured puts. I typically like to target stocks that offer a dividend and are below fair value.
Why a dividend? If the trade results in assignment and I’m on the hook for X amount of shares, I can at least be satisfied knowing I picked a (hopefully under fair value) company that will pay me a small amount while I run the other side of the trade AKA covered calls.
It’s a fairly low-risk strategy (all options trading is risky!), that has a higher probability of success, but requires a higher amount of collateral.
RGTI does not offer a dividend. It’s a small cap company, but the stock is relatively cheap and the quantum computing industry will probably continue growing in the future.
So if you saw the most recent image above, I already STO (sold to open) 10 contracts of the $10 put for the August 15th expiration. I like to have a DTE (Days to Expiration) that is around ~45 days. I know the August 22nd DTE is closer to 45 days, but there is more volume for the third Friday of the month right now.
When the trade reaches 50% profit I will buy it back. I don’t like to be greedy and go for more profit, because I would rather not waste my time being in a trade for too long.
Wait…Where Are the Candlesticks? And All the Other Indicators?
I know many traders love their candlesticks and a ton of indicators. I prefer simplicity. Candlesticks aren’t necessary unless you’re the kind of trader that wants to try and pick the perfect moment to execute a trade, and even then it’s not a sure thing.
As for indicators, there are a ton. Some of them work sometimes. None are perfect. I don’t want to get bogged down with too many. You’ll drive yourself crazy looking at too many of them, so find a handful you like and stick with those.
Disclosure
- I currently have open trades with RGTI (as mentioned in this post).
- No trade is a sure thing. There is always risk involved.
- This blog post is not meant to take the place of financial advice, but hopefully acts as a guide for learning or informational purposes.