Bigbear.ai‘s BBAI shares have surged 90.5% in the trailing 12-month period compared with the Zacks Computer & Technology sector’s return of 32.1% and the Zacks Computers - IT Services industry’s rise of 12.7 %.
The company has outperformed its industry peers, such as DXC Technology DXC and ServiceNow NOW over the trailing 12-month period. Shares of DXC and NOW have returned 6.4% and 38.6%, respectively.
The outperformance can be attributed to BBAI’s expanding product portfolio and a strong network of partners, which continue to drive its growth.
The positive momentum is further supported by BigBear.ai’s ability to capitalize on the growing government investment in artificial intelligence (AI) solutions. The increasing government interest bolsters BBAI’s innovation pipeline and allows it to adapt and extend its capabilities to serve a larger market.
BBAI Shares Beat Sector, Industry
Image Source: Zacks Investment Research
BigBear.ai’s Strong Portfolio Aids Prospects
BigBear.ai’s strong portfolio has been a major growth driver for its success, demonstrated by its initiatives across multiple sectors.
This success is highlighted by BBAI’s participation in the U.S. Navy’s Mission Autonomy Proving Ground exercises in the third quarter of 2024, where it showcased its ConductorOS platform, enabling AI-driven maritime domain awareness, ensuring multi-vendor interoperability and emphasizing BigBear.ai’s leadership in defense and maritime advancements.
Further solidifying its position in the federal sector in December 2024, BigBear.ai secured a position in the U.S. General Services Administration’s One Acquisition Solution for Integrated Services Plus Unrestricted Multiple Agency Contract.
This 10-year Indefinite Delivery Indefinite Quantity (IDIQ) contract enables BigBear.ai to provide services across five key domains, including Management and Advisory, Technical and Engineering, Research and Development, Intelligence Services, and Logistics, with flexible, unlimited task orders to support federal agencies.
In the third quarter of 2024, BigBear.ai and the Concept Solutions team were awarded a shared IDIQ contract with the Federal Aviation Administration. This contract supports the Office of Information Technology with a $2.4 billion ceiling over 10 years for IT capabilities and emerging technologies. This initiative further reinforces BigBear.ai’s growing role in government technology services.
BigBear.ai Holdings, Inc. Price and Consensus
BigBear.ai Holdings, Inc. price-consensus-chart | BigBear.ai Holdings, Inc. Quote
BBAI Expands With Rich Partner Base and Military Contract
BigBear.ai’s focus on expanding its product portfolio has helped it win clients. Its products have been integrated into the solutions of Proof Labs, Autodesk, Amazon AMZN and Palantir.
In December 2024, BigBear.ai announced a collaboration with Proof Labs to develop the Cyber Resilient On-Orbit solution for the Department of the Air Force. The solution will leverage Proof Labs' SpaceCREST technology for AI/ML-driven real-time cyber intrusion detection and anomaly monitoring of U.S. Space Force satellite networks.
AMZN’s cloud platform, Amazon Web Services (“AWS”), integrated BBAI’s ProModel solution to build AWS ProServe, enabling it to provide AI-driven warehousing.
Autodesk, Amazon and Palantir are the undisputed leaders of the industry. The adoption of BBAI’s products by these giants reflects the quality assurance of its product suite.
In the third quarter of 2024, BBAI announced a $165.15 million, five-year sole-source prime contract from the U.S. Army to complete the Global Force Information Management Production Services. This contract will transition legacy systems into a data-centric, intelligent automation platform to enhance force structure decision-making and operational readiness.
Earnings Estimates Show Upward Trend
BigBear.ai’s expanding product portfolio, key federal contracts, and strong partnerships position it for continued growth and leadership in the AI and defense sectors. These have contributed to the optimistic sales and earnings growth estimates for 2025.
The Zacks Consensus Estimate for 2025 revenues is pegged at $194.31 million, indicating year-over-year growth of 15.27%.
The consensus mark for 2025 loss per share is pegged at 20 cents, unchanged in the past 30 days. The figure indicates a year-over-year increase of 73.33%.
Earnings Estimate
Image Source: Zacks Investment Research
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Conclusion: Hold BBAI Stock for Now
BBAI stock is not so cheap, as the Value Score of F suggests a stretched valuation at this moment.
Despite its growing portfolio and strategic partnerships, BBAI faces intense competition in the AI market. The challenging macroeconomic environment and losses from the Virgin Orbit bankruptcy are likely to affect the company’s growth performance.
BBAI currently has a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for a more favorable entry point to accumulate the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
ServiceNow, Inc. (NOW) : Free Stock Analysis Report
DXC Technology Company. (DXC) : Free Stock Analysis Report
BigBear.ai Holdings, Inc. (BBAI) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
