IonQ shares jumped 15% on Friday, reversing a multi-day sell-off sparked by AI bubble fears. The surge wasn’t driven by company-specific developments but rather the broader tech rally after a tough week for the sector.
The Nasdaq Composite dropped 4.5% over four trading sessions as investors fled tech stocks amid concerns about artificial intelligence spending sustainability. However, the index reversed course on Friday and finished up 2.1%.
Big tech companies like Alphabet and Amazon have announced plans to spend billions of dollars in AI research and development this year. This has renewed fears about an AI bubble and accelerated capital expenditures.
IonQ’s market capitalization is nearly $13 billion, but its revenue over the last 12 months is just $80 million. Analysts at The Motley Fool Stock Advisor team recommend avoiding IonQ shares due to their high valuation. However, some investors may be tempted by the stock’s recent surge.
If you’re considering investing $1,000 in IonQ or any other stock, it’s worth exploring alternative options that have performed well in the past and are recommended by The Motley Fool Stock Advisor team.
Source: https://www.nasdaq.com/articles/why-did-ionq-stock-skyrocket-friday