We recently compiled a list of the 10 Best Quantum Computing Stocks To Buy According to Hedge Funds. In this article, we are going to take a look at where NVIDIA Corporation (NASDAQ:NVDA) stands against the other best quantum computing stocks.
Quantum computing stocks are once again in focus after yesterday’s major breakthrough announcement by one of the biggest players in this field.
Investors have had high expectations from quantum computing firms for many years, but the technology has consistently failed to deliver on the promise. However, a deeper understanding of the tech behind quantum computing is required to fully understand the complexity of the issue. Quantum computers were theorized in the 1980s, but their development has been fraught with challenges due to the fragility of qubits. Unlike traditional computers that use binary bits, like ones and zeroes, quantum computers utilize quantum bits, or qubits, which can exist in multiple states simultaneously due to superposition. Qubit fragility typically leads to higher error rates for quantum computers. Companies have tried to address qubit fragility through innovations — ranging from light particles to trapped ions, but few have been successful. However, latest breakthroughs in this field herald the arrival of quantum supremacy – a term used to explain the processing power of quantum computers compared to traditional ones.
Read more about these developments by accessing 10 Best Quantum Computing Stocks to Buy According to Analysts and 10 Buzzing AI Stocks According to Goldman Sachs.
Since the latest breakthroughs showcase that quantum computers can accomplish tasks in minutes that would otherwise take ten septillion years – exceeding the age of the universe – it would be reasonable to assume that quantum computers can now move on from accomplishing mundane tasks like generating random numbers or solving specific mathematical problems, towards practical applications in drug discovery, artificial intelligence, and cryptography. This has huge implications for investors who are increasingly frustrated by the plateauing advancement in the field of AI and are actively exploring for emerging opportunities in the tech field that offer explosive growth potential along the same lines. Sylvia Jablonski, the CEO of Defiance ETFs, appeared on news platform CNBC earlier this year to highlight this.
“The way I see markets today is the absolute fervor and interest in all things A.I. and A.I. is the tide that rises all boats. I think quantum is the next generation of A.I. You need it to process data and make changes in all of the sectors we have been talking about that A.I. has been impacting with drug discovery and curing diseases. Just as AI is powering progress in not just the computer industry, but in fields that adopt the use of AI, quantum computing will be used in processing data for sectors already being transformed by AI, such as drug discovery and curing diseases.”
READ ALSO: 12 Best Quantum Computing Stocks To Invest In and Beyond the Tech Giants: 35 Non-Tech AI Opportunities.
For this article, we selected quantum computing stocks by sifting through the holdings of popular quantum computing ETFs. The stocks listed below are also popular among hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A close-up of a colorful high-end graphics card being plugged in to a gaming computer.
NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 193
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. Even though the company is not directly involved in the manufacture of quantum computing hardware, it still makes it to the list of best quantum computing stocks to buy according to hedge funds because it focuses on creating software, tools, and hardware integration for hybrid quantum-classical computing systems. For example, it markets NVIDIA cuQuantum, a software development kit designed for simulating quantum circuits on classical GPUs. This platform allows researchers to build and test quantum algorithms without needing access to quantum hardware.
The famous Selene Supercomputer, the internal GPU-powered supercomputer developed by NVIDIA, is used for quantum simulation research as well. The GPUs provided by the company are used to run quantum algorithms in various industries. For example, in drug discovery, they are used to accelerate quantum simulations for molecular modeling and interactions. In cryptography, they are used in developing and testing quantum-safe encryption techniques.
NVIDIA markets NVIDIA Quantum Cloud as well. The cloud provides access to one of the most powerful quantum computing platforms in the world through Quantum Cloud APIs capable of running high tech projects on a range of NVIDIA GPU systems. These quantum products are integrated into the AI offerings of the company, helping it post record-breaking revenue numbers. In the third quarter of fiscal 2025, NVIDIA reported a record revenue of $35.1 billion, a 17% increase from the previous quarter and a 94% rise from the same period the previous year.
Overall, NVDA ranks 3rd on our list of the best quantum computing stocks to buy according to hedge funds. While we acknowledge the potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
