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Quantum Computing Quest: 3 Stocks on the Cutting Edge

The U.S. economy is poised for a potential fiscal boost with a proposed $70 billion tax deal, currently under negotiation in Congress. If approved, the deal includes renewing expired business tax breaks and increasing the child tax credit, but it faces challenges in a divided Congress. While the extra cash could stimulate consumer spending, concerns about potential inflationary pressures complicate the Federal Reserve’s ability to lower interest rates. This positivity means that innovation will continue to rage on in 2024, and as a result, you should buy these three quantum computing stocks.

Honeywell International Inc (HON)

Stocks to buy: smartphone with the words "buy" and "sell" displayed on the screen. The user's finger is about to press buy. Stock charts are in the background of the image. Momentum Stocks.Source: Chompoo Suriyo / Shutterstock.com

Honeywell International Inc (NASDAQ:HON) is an American conglomerate corporation with operations in technologies, aerospace, building automation, and performance materials. It is valued at an impressive $201.10.

Financially, HON is thriving demonstrated by its EBIT Margin of 20.71% which is 111.08% more than the sector median. Cash From Operations is also a colossal 1,513.77% more than the sector median and Cash Per Share is 459.02% more. Working Capital Growth (YoY) is 844.66% more than the sector average and PEG GAAP is 846.67%. These financials truly exhibit how well-rounded HON is. 

As of January 12, Honeywell and NXP have signed a deal to build next-gen automation with AI, and HON is also furthering its quantum tech solutions. NXP’s superior tools will allow the AI to adapt, observe, and learn in real-time and is expected to be a major step in the AI breakthrough. And Honeywell’s quantum tech will help propel this chip technology to the next level. This new deal indicates that Honeywell is on the cutting edge. As it continues experimenting with AI its financials will only rise more. 

Due to this partnership deal and financials, I give Honeywell a “Buy” rating, and strongly recommend it to anyone trying to diversify their portfolio with a quantum computing stock.

Alphabet Incorporated (GOOGL)

Alphabet Inc. (GOOG, GOOGL) and Google logos seen displayed on smartphones. The Google stock split is happening today.Source: IgorGolovniov / Shutterstock.com

Alphabet Inc. (NASDAQ:GOOGL) is an American multinational tech company that is the parent company of Google, Nest, YouTube, Waze, and Fitbit to name a few.

GOOGL’s stock is up 1.15% YTD at $142.54 and is covered by 50 analysts. These analysts are predicting a 12-month price forecast with a median-high price of $155.50-$180.00 representing increases of nearly 9.1% and 26.3% respectively.

From 2022-2023, Alphabet’s market cap grew by 53.43% from $1.145 trillion to $1.756 trillion. Revenue also grew by 5.05% and earnings by 9.9%. The P/S ratio also grew by 37.75% in the same time frame. EBITDA Growth was 196.44% more than the sector median and EPS FWD Long Term Growth (3-5Y CAGR) was 88.85% more. 

In the past year, GOOGL has expanded its Google Cloud to locations like Greece, Mexico, Sweden, and Saudi Arabia which has given its stock a massive boost. As it continues to expand, a similar trend should follow. In addition, Alphabet recently released a foldable phone, causing shockwaves throughout the industry. Product innovation, especially, within quantum computing, will only propel them forward and allow them to continue pioneering in the tech world.

Due to GOOGL’s expansion, innovation, and rising financials, I give it a “Buy” rating and expect it to rise shortly.

Splunk Inc (SPLK)

Splunk Stock Will Keep Powering Higher Despite Being OvervaluedSource: IgorGolovniov / Shutterstock.com

Splunk Inc (NASDAQ:SPLK) is an American software company, that produces an operating system to analyze, search, and monitor data. It is valued at $152.72 up 71.85% from last year.

Financially, Splunk has shown improvement in most if not all metrics. Revenue Growth (YoY) was 20.49%, nearly 227.30% more than the sector median of 6.26%. Gross Profit Margin grew to 79.07% which was 60.04% than the sector median, and Levered FCF Margin was 191.70% more than the sector average. EV / EBIT was also 833.86% more than the sector median, all indicating the well-roundedness of SPLK financials.

Spunk’s new edge processor is expected to be revolutionary for the industry. RawHEC Support allows data to be received in a simpler format thus making it easier for information to be transferred to Splunk from 3rd party systems. In addition, the edge processor allows Lookups, allowing details to be added to data before it is officially saved. 

As Splunk continues innovating, its strong financials will become even stronger. With its positive outlook, I give it a “Buy” rating.

On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article

Michael Que is a financial writer with extensive experience in the technology industry, with his work featured on Seeking Alpha, Benzinga and MSN Money. He is the owner of Que Capital, a research firm that combines fundamental analysis with ESG factors to pick the best sustainable long-term investments.

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