BigBear.ai Holdings, Inc. (BBAI Quick QuoteBBAI - Free Report)  operates at the crossroads of national security, border technology, and applied AI—segments where funding flows can be uneven but, when secured, have the potential to meaningfully accelerate growth. After a volatile first half, the stock has reset from its early-year peaks, leaving valuation multiples below prior highs and inviting a fresh look for investors weighing risk against optionality. BigBear.ai’s forward 12-month price-to-sales (P/S) ratio currently sits at 11.81, well below the Zacks Computers - IT Services industry average of 17.04, suggesting relative undervaluation.

BBAI’s P/S Ratio (Forward 12-Month) vs. Industry

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BBAI Stock’s Valuation vs. Peers

Relative to peers in the AI, national security, and defense technology space, BigBear.ai appears to trade at a discount on forward revenue multiples. Palantir (PLTR Quick QuotePLTR - Free Report) , a heavyweight with entrenched government ties, commands a lofty 79.13x forward 12-month sales, while BigBear.ai sits below that threshold. However, the company still trades at a premium versus C3.ai (AI Quick QuoteAI - Free Report) , which is valued at 7.05x F12M sales.

Palantir’s deep integration with the Department of Defense and intelligence agencies, alongside its scale across mission-critical analytics, gives it a strong edge in securing a meaningful slice of OB3 allocations. C3.ai, meanwhile, has carved out a position with its broad suite in defense readiness, predictive maintenance and logistics, directly overlapping with BigBear.ai’s pursuits. With stronger reputations and wider reach, both Palantir and C3.ai pose formidable challenges, setting a high bar for BigBear.ai to clear.

BBAI Stock’s Performance

BigBear.ai stock has been on a turbulent ride following its second-quarter 2025 earnings release because of the disappointing revenue, lowered guidance, and widening losses. After bottoming out, however, BBAI stock showed modest strength in late August and into September. The movement toward $5.06 by Sept. 12 suggests that some of the selling pressure was alleviated, possibly as investors reassessed the worst-case scenarios and reacted to any incremental positive signals. Over the past three months, the BBAI stock has gained 22.2%, outperforming both the industry, the broader Zacks Computer & Technology sector and the S&P 500. Over the last year, BBAI stock has still registered a large gain, up 220%.

BBAI's 3-Month Performance

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Balance Sheet Firepower: A Strategic Positive for BBAI

Against those near-term headwinds, BigBear exited the second quarter with a record $390.8 million in cash and cash equivalents and reported backlog of $380 million. That liquidity—unusual for a company of its size—gives management room to invest organically, weather timing gaps in federal awards, and pursue targeted M&A to deepen moat areas like computer vision at the border and orchestration at the tactical edge.

Driving Factors: Why the Long Game Still Appeals

Mission-Ready AI in Priority Domains: BigBear’s stack is built for real-time decision intelligence in sensitive environments—border crossings, ports, defense networks—where accuracy and latency are non-negotiable. ConductorOS, its AI/data/sensor orchestration platform, targets the emerging need to coordinate heterogeneous edge devices across the modern battlespace, a theme likely to sustain demand as defense programs scale from pilots to production.

Policy Tailwinds and Funding Theories: The passage of the One Big Beautiful Bill (OB3) has created a generational investment cycle in areas core to BigBear.ai’s mission. The bill allocates $170 billion to DHS, including $6.2 billion for border technology and $673 million for biometric exit solutions, as well as $150 billion to DoD, with $16 billion earmarked for AI autonomy and $29 billion for shipbuilding. BigBear.ai is already embedded in these areas. Its veriScan biometric solutions are deployed across 25 airports on 2,000+ devices, while ConductorOS has demonstrated battlefield utility in drone swarm exercises. On the logistics side, Shipyard AI aligns directly with OB3’s shipbuilding funding. These alignments give BigBear.ai a first-mover advantage as federal procurement accelerates.

Backlog and Contracting Momentum: Even as certain Army programs have caused turbulence, BigBear continues to cite a sizeable backlog and prior multi-year awards (e.g., the GFIM-OE production contract announced late 2024), which indicate established customer relationships and a platform for follow-on scope. Execution against this book, rather than headline deal announcements alone, will be the tangible driver of 2026–2027 visibility.

Beyond U.S. opportunities, BigBear.ai is strengthening global relevance. A $1.4 trillion AI partnership with the UAE underscores demand for its products in critical infrastructure and security. The company also launched a cargo security solution in Panama with Narval Holdings, opening doors to broader Latin American trade networks. Such partnerships not only diversify revenue streams but also reduce reliance on a handful of large U.S. government contracts.

Key Challenges: What Could Keep the Multiple Capped

Contract Timing and Visibility: The same federal modernization efforts that open long-run opportunities are causing near-term disruptions. The Army’s consolidation of data platforms reduced near-term revenue visibility, leading management to cut 2025 revenue guidance to $125-$140 million and withdraw EBITDA outlook. This underscores that profitability depends on award timing and mix—factors largely outside the company’s control, quarter to quarter. That uncertainty can suppress multiples until awards convert and margins normalize.

Profitability and Cost Discipline: Adjusted EBITDA losses widened in the second quarter, with R&D and growth investments weighing on near-term results. While the cash cushion buys time, investors will want to see operating leverage from scale projects or services mix shift back toward higher-margin work. Progress here is likely to be the catalyst for a sustained re-rating, rather than trading rallies around headlines.

Estimate Trends of BigBear.ai Stock

Analysts have grown more pessimistic in recent weeks. The Zacks Consensus Estimate for 2025 loss per share has widened sharply—from a projected loss of 41 cents to a much deeper loss of $1.10 over the past 60 days. The company had reported the same in the year-ago period.

This trend suggests that profitability is not on the horizon and that cost pressures may continue to intensify.

Image Source: Zacks Investment Research

Conclusion: A Stock to Hold for Long-Term Payoff

BigBear.ai’s second-quarter results highlighted the volatility that comes with federal contract dependence, but also underscored the company’s financial flexibility and strategic positioning. The stock trades at a discount relative to its long-term potential, supported by unmatched cash reserves, direct exposure to historic AI and defense spending, and strengthening international partnerships.

That said, near-term earnings visibility remains clouded by Army contract resets, negative EBITDA, and guidance uncertainty. For investors seeking a balance of risk and opportunity, BigBear.ai remains best viewed as a long-term speculative play with asymmetric upside potential rather than a near-term earnings story.

With a Zacks Rank #3 (Hold), the stock merits patience. Investors should maintain positions, watching for signs of contract wins, margin improvement, and disciplined capital deployment to unlock its hidden opportunity. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.