Could Investing $10,000 in IonQ Stock Make You a Millionaire?

Investing in early-stage companies like IonQ (IONQ +23.42%) with major upside in the quantum computing space is an attractive proposition. If you pick the right stocks, it could provide life-changing returns. Some are even calling IonQ stock a millionaire-maker stock.

Could a $10,000 investment in IonQ really make you a millionaire? Let’s take a look.

Image source: The Motley Fool.

IonQ would be a giant company if it rose 100-fold

Turning a $10,000 investment into a $1 million sum requires finding a stock that can rise 100x. Few stocks in the market have done this, but there are several examples out there. However, history is not on IonQ’s side. IonQ is currently a $10 billion company, so it would need to become a $1 trillion company to reach this goal. There aren’t a ton of $1 trillion companies on the market, but the list is growing bigger each year.

One company fairly similar to IonQ that was valued at more than $1 trillion prior to selling off was AMD (AMD +11.04%). While AMD is valued at $762 billion now, it’s a great stock to compare IonQ to because they both make computing units. Over the past 12 months, AMD’s revenue has totaled over $40 billion.

AMD Revenue (TTM) data by YCharts.

So, for IonQ to get into the $1 trillion club, its revenue must reach that or even higher. McKinsey & Company estimates that the global quantum computing market could generate up to $72 billion annually by 2035, so if IonQ captures the whole market, this revenue figure isn’t too far-fetched. However, capturing all of it will be a tall task, as there are several potent competitors with huge cash backing that could challenge IonQ in the quantum computing realm.

As a result, I don’t think achieving a $1 trillion valuation is in the cards for IonQ anytime soon.

Furthermore, IonQ is a very high-risk company. Putting any more than 1% of your total portfolio into IonQ’s stock would be very risky. If 1% of your portfolio equals $10,000, congratulations, you’re already a millionaire!

So, can a $10,000 investment in IonQ make you a millionaire? I’d say no. Additionally, investing $10,000 in a much smaller portfolio than $1 million would be very risky and could have some major implications for your long-term returns if it doesn’t work out. However, that doesn’t mean IonQ is a bad investment — just that investors need to temper their expectations.

Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.