Short-selling firm Iceberg Research has published a new short report, reiterating its bet against Quantum Computing (QUBT) stock. The quantum computing and chip company recently announced a registered direct offering, raising $40 million through the issuance of 16 million shares of common stock at $2.50 per share. However, Iceberg’s report argues that the press releases supporting this move were based on speculation and hearsay, criticizing the company’s attempts to rebrand as a chip foundry.
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What’s Happening with QUBT Stock Today?
News of the short report seems to be pushing QUBT stock down today. As of this writing, shares are down 4.5% for the day and their current trajectory suggests that they have further to fall. After weeks of little to no price action, QUBT surged earlier this month on news of the direct offering, rising 990%. The momentum has since cooled off, though, which suggests that there may be validity to the claims made by Iceberg that challenge Quantum’s statements.
This isn’t the first time that Iceberg Research has called out Quantum Computing in a short report. The short seller first revealed a bet against QUBT stock in October 2022, highlighting problems with the company’s software and describing its efforts to market it as a “smoke screen.” Now Iceberg has identified new problems as Quantum attempts to rebrand as a chip foundry, specifically that order announcements seem to be either false or exaggerated.
According to the report, Quantum had initially announced a large chip order from The University of Texas at Austin but it has since removed any mentions of the university from its communications, changing the headline of a press release published on November 20. A university representative confirmed that the school had only placed a small chip order and the report had not been reviewed before Quantum published it. The report also alleges that there is no foundry listed at an address on the company’s webpage.
Is It Time to Sell Quantum Computing Stock?
If these accusations are correct, Quantum Computing stock could be severely compromised. Since no Wall Street analysts currently follow QUBT stock, it is hard to properly assess which rating it deserves based on expert opinions. That said, the TipRanks Technical Analysis tool suggests a Buy signal on the one-day timeframe, based on overall bullish sentiment.
