IonQ (NYSE: IONQ) stock posted one other day of big gains in Thursday’s trading. The quantum-computing company’s share price closed out the every day session up 13.5% and had been up as much as 17% earlier within the day.
IonQ’s big gains today are connected to Nvidia‘s (NASDAQ: NVDA) recent third-quarter earnings report, which saw the factitious intelligence (AI) leader post sales, earnings, and forward guidance that beat Wall Street’s expectations. Despite slipping early within the day’s trading, Nvidia stock ended the day’s trading up 0.5% — and its strong quarterly performance and share price gains helped power momentum for other growth stocks.
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Nvidia has been this 12 months’s hottest and most influential megacap growth stock. The corporate has develop into increasingly central to momentum for the stock market at large, and its performance often has an outsized impact on valuations for growth-dependent stocks. The AI frontrunner’s Q3 beats and inspiring forward guidance helped support bullish momentum for growth stocks and speculative technology plays today.
In Q3, Nvidia posted non-GAAP (adjusted) earnings per share of $0.81 on revenue of $35.08 billion. For reference, the typical analyst estimate had called for the business to report adjusted earnings of $0.75 on sales of $33.16 billion. Nvidia’s guidance for revenue of $37.5 billion within the fourth quarter of its current fiscal 12 months also surpassed the typical Wall Street estimate’s call for sales of $37.08 billion within the period.
Nvidia stock initially slipped after the Q3 release because some investors were searching for even larger performance beats, but its quarterly report and forward guidance had immediately helpful valuation impacts for a lot of other tech stocks. IonQ stock rallied earlier within the week after the corporate announced that it had successfully accomplished an indication of its technologies at the side of Nvidia’s CUDA-Q software platform for hybrid quantum computing, and the quantum stock enjoyed one other surge at the side of Nvidia’s strong quarterly results.
Following today’s gains, IonQ stock is up 164% across 2024’s trading. The corporate now has a market capitalization of roughly $7.1 billion and is valued at roughly 170.5 times this 12 months’s expected sales.
As an organization with a core business that hinges on delivering revolutionary technologies, it doesn’t make sense to place an excessive amount of weight behind traditional valuation metrics. Alternatively, IonQ’s valuation highlights the likelihood that long-term performance for the quantum-specialist’s stock will likely have somewhat of a binary end result.