IonQ, Inc. (NYSE: IONQ)

Sector: Technology Industry: Computer Hardware CIK: 0001824920
Market Cap 12.25 Bn
P/B 5.39
P/E -8.36
P/S 153.44
ROIC (Qtr) -27.60
Div Yield % 0.00
Rev 1y % (Qtr) 221.50
Total Debt (Qtr) 28.52 Mn
Debt/Equity (Qtr) 0.01

About

IonQ, Inc., a company operating in the quantum computing industry, is dedicated to developing quantum computers that can solve some of the world's most complex problems. Its ticker symbol is IONQ. The company's main business activities include developing and manufacturing quantum computing hardware and providing access to its quantum computers through cloud-based services. IonQ's primary products are its quantum computing systems, which utilize a trapped ion approach. This method involves individual atoms being trapped in a vacuum chamber and manipulated...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 346.03M provide 40.24x coverage of short-term debt 8.60M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of (248.10M) provides exceptional 183.92x coverage of minority interest expenses (1.35M), showing strong core operations.
  • Strong tangible asset base of 1.80B provides 63.04x coverage of total debt 28.52M, indicating robust asset backing and low credit risk.
  • Tangible assets of 1.80B provide exceptional 71.22x coverage of deferred revenue 25.24M, showing strong service capability backing.
  • Short-term investments of 736.33M provide solid 6.48x coverage of other current liabilities 113.71M, indicating strong liquidity.

Bear case

  • Operating cash flow of (248.10M) barely covers its investment activities of (849.27M), with a coverage ratio of 0.29, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (849.27M) provide weak support for R&D spending of 249.69M, which is -3.40x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 346.03M provide limited coverage of acquisition spending of (28.55M), which is -12.12x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of (248.10M) provides insufficient coverage of deferred revenue obligations of 25.24M, which is -9.83x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of (248.10M) shows concerning coverage of stock compensation expenses of 244.64M, with a -1.01 ratio indicating potential earnings quality issues.

Peer comparison

Companies in the Computer Hardware
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ANET Arista Networks, Inc. 164.72 Bn 49.07 19.50 0.00 Bn
2 DELL Dell Technologies Inc. 86.37 Bn 16.20 0.83 31.24 Bn
3 WDC Western Digital Corp 60.34 Bn 23.73 5.03 4.68 Bn
4 STX Seagate Technology Holdings plc 58.67 Bn 34.25 6.14 4.99 Bn
5 SNDK Sandisk Corp 34.41 Bn -19.78 4.42 1.35 Bn
6 PSTG Pure Storage, Inc. 21.84 Bn 167.52 6.27 0.23 Bn
7 HPQ Hp Inc 21.10 Bn 8.34 0.38 9.67 Bn
8 SMCI Super Micro Computer, Inc. 17.45 Bn 22.01 0.83 4.78 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.81 2.06
EV to Cash from Ops. EV/CFO -48.89 -0.65
EV to Debt EV to Debt 425.34 56.37
EV to EBIT EV/EBIT -8.16 2.89
EV to EBITDA EV/EBITDA -27.84 -1.74
EV to Free Cash Flow [EV/FCF] EV/FCF -46.10 -7.44
EV to Market Cap EV to Market Cap 0.99 7.64
EV to Revenue EV/Rev 151.92 78.30
Price to Book Value [P/B] P/B 5.39 -28.73
Price to Earnings [P/E] P/E -8.36 6.39
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 1.25
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 12.30
Dividend per Basic Share Div per Share (Qtr) 0.00 0.27
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 7.93
Interest Coverage Interest Coverage 0.00 -105.42
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 42.32 -11.38
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 1,046.86 867.36
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 4.71
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -754.57 -189.41
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -126.06 -40.76
EBIT Growth (1y) % EBIT 1y % (Qtr) -766.28 -117.00
EBT Growth (1y) % EBT 1y % (Qtr) -766.28 -116.68
EPS Growth (1y) % EPS 1y % (Qtr) -554.88 -70.06
FCF Growth (1y) % FCF 1y % (Qtr) -121.24 712.64
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 118.07 34.90
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.02 0.80
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.06
Cash Ratio Cash Ratio (Qtr) 2.48 7.26
Current Ratio Curr Ratio (Qtr) 8.73 13.59
Debt to Equity Ratio Debt/Equity (Qtr) 0.01 -3.57
Interest Cover Ratio Interest Cover Ratio 0.00 -105.42
Times Interest Earned Times Interest Earned 0.00 -105.42
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -1,802.30 -629.92
EBIT Margin % EBIT Margin % (Qtr) -1,860.96 -683.67
EBT Margin % EBT Margin % (Qtr) -1,860.96 -687.58
Gross Margin % Gross Margin % (Qtr) 51.20 34.79
Net Profit Margin % Net Margin % (Qtr) -1,836.30 -692.43