IONQ Holdings, Inc. (IONQ)vs SHOP Holdings, Inc. (SHOP)

Quick verdict

IONQ Holdings, Inc. (IONQ) and SHOP Holdings, Inc. (SHOP) appeal to different investors. On our six-factor framework, IONQ scores 4 and SHOP scores 2. IONQ looks cheaper on the multiples that matter, while IONQ grows faster and IONQ earns higher returns on capital. Overall, IONQ edges this comparison, but the right pick depends on whether you prioritise value, growth, income or balance-sheet safety.

2-year relative performance

At-a-glance comparison

Business model and revenue mix

IONQ Holdings, Inc. operates in Internet Content & Information (Communication Services), while SHOP Holdings, Inc. sits in Beverages (Consumer Defensive). The two operate in different sectors, so cyclicality and end-market exposure differ — factor that into any portfolio overlap. IONQ carries a beta of 1.75 versus 0.64 for SHOP, meaning IONQ has historically been the more volatile of the two.

Valuation

On valuation, IONQ is the cheaper stock. IONQ trades on a forward P/E of 15.88 and EV/EBITDA of 15.3, against 16.83 and 10.2 for SHOP. Price-to-sales is 1.79 vs 3.26, and free-cash-flow yield is 3.8% vs 2.0%. A higher multiple is only justified if the company can sustain faster growth or wider margins, which is exactly what the next sections test.

Growth profile

IONQ is the faster grower. IONQ has compounded revenue at 6.0% over three years with EPS growth of 7.1%, while SHOP has delivered 4.0% revenue and 3.5% EPS growth. Growth like this is the single biggest driver of long-term returns, but it also tends to come with a richer valuation, so it must be weighed against the multiples above.

Profitability and quality

On profitability and quality, IONQ is stronger. IONQ posts a 42.7% operating margin, 47.4% return on equity and 26.6% return on invested capital. SHOP posts 15.5%, 47.7% and 8.3% respectively. Return on invested capital above roughly 15% is a hallmark of a durable competitive advantage, so this metric deserves particular attention.

Balance-sheet risk

SHOP has the safer balance sheet. IONQ carries net-debt/EBITDA of 3.97x with a current ratio of 1.39, versus 0.69x and 3.24 for SHOP. Lower leverage gives a company more room to invest through a downturn and reduces the risk of dilution or distress.

Price performance and shareholder returns

Over the past year IONQ returned -13.4% against 42.9% for SHOP; on a three-year annualised basis it is -6.7% vs 16.6%. IONQ yields 3.3% and SHOP yields 1.4%. Past performance never guarantees future results, but the multi-year track record shows how the market has rewarded each business so far.

Which stock fits which investor

For value-oriented investors, IONQ is the better fit on today's multiples. Growth investors will likely prefer IONQ, which is expanding faster. Income investors should lean toward IONQ for its higher shareholder yield, while investors who prize quality-at-a-reasonable-price will favour IONQ for its superior returns on capital. This is a comparison of facts, not a recommendation — your time horizon, risk tolerance and existing holdings should drive the final decision.

• Value: IONQ
• Growth: IONQ
• Income: IONQ
• Quality: IONQ

Frequently asked questions

Is IONQ or SHOP the better buy right now?

Neither is universally "better." IONQ scores 4 and SHOP scores 2 on our six-factor framework. IONQ is cheaper, IONQ grows faster, and IONQ is higher quality — so the right pick depends on your objective.

Which stock is cheaper, IONQ or SHOP?

IONQ is the cheaper stock across forward P/E (15.88 vs 16.83), EV/EBITDA (15.3 vs 10.2) and price-to-sales (1.79 vs 3.26).

Which has grown faster, IONQ or SHOP?

IONQ has the stronger growth profile, with three-year revenue CAGR of 6.0% for IONQ versus 4.0% for SHOP.

Which stock pays a bigger dividend?

IONQ yields 3.3% and SHOP yields 1.4%, so IONQ is the stronger income choice.

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