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BigBear.ai Stock Rises 36% in 6 Months: Is It Still a Buy?
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Key Takeaways
BBAI stock is up 36% in 6 months, outperforming its sector and trading above its 200-day moving average.
Earnings expectations have improved, with 2025 and 2026 loss forecasts narrowing significantly.
The Ask Sage acquisition positions BBAI for secure AI growth across U.S. defense and government agencies.
BigBear.ai Holdings, Inc. (BBAI - Free Report) has enjoyed a sharp rebound over the past six months, rising nearly 36% and outperforming major benchmarks, including the S&P 500, the Zacks Computer and Technology sector and even the Zacks Computers – IT Services industry. With the stock trading around $5.79 (as of Dec. 2) and remaining well above its 200-day moving average, investors are weighing whether the rally still has room to run or if the upside is starting to plateau.
The company’s recent momentum is supported by improving earnings expectations, a strengthened balance sheet and a potentially transformative acquisition. Yet it also faces challenges, including revenue pressure, government funding uncertainty and execution risk.
BBAI Stock’s 6-Month Performance
Image Source: Zacks Investment Research
Momentum Strengthened by Technically Positive Trends
Over the past half-year, BigBear.ai stock’s performance has been supported by a marked improvement in investor sentiment and a favorable technical setup. The chart shows that the stock is trading well above its 200-day moving average, which stands near $5.29, indicating a constructive long-term uptrend. At the same time, shares now sit slightly below the 50-day moving average of about $6.75, reflecting a short-term pause following a strong run.
The stock’s technical setup in 2025 has been volatile. The chart shows a sharp jump in February, followed by a long consolidation phase through spring. Momentum returned in July, with a steady climb into September and October, reflecting rising investor confidence as BigBear.ai outlined its acquisition plans and capital-raising efforts. The recent pullback places the stock in a zone where volume has risen meaningfully—near 60 million shares on Dec. 2, according to the chart data. This surge in trading activity aligns with heightened interest around the Ask Sage acquisition and the company’s strengthened liquidity position.
Image Source: Zacks Investment Research
Earnings Expectations Support the Uptrend for BBAI Stock
BigBear.ai stock’s performance has been bolstered by a meaningful shift in analyst forecasts. Over the past month, expectations for the company’s 2025 loss per share narrowed from $1.10 to 93 cents, while the anticipated 2026 loss per share improved from 32 cents to 25 cents. The company had previously posted a loss of $1.10 in the year-ago period, making the projected trajectory one of steady improvement rather than abrupt transformation.
Revenue expectations show a mixed picture. Analysts anticipate a 16.1% revenue decline in 2025, reflecting lingering weakness in certain government programs. However, the Zacks Consensus Estimate forecasts a 30.2% rebound in 2026, reflecting management’s confidence that delayed contracts, new government funding cycles and recent strategic moves will begin to contribute more meaningfully. The combination of strong share-price gains and narrowing loss expectations helps explain why the stock has significantly outpaced its industry and sector peers.
Financial Profile Strengthened by Record Cash Levels
The company’s third-quarter 2025 results underscored both operational challenges and financial progress. Revenues for the third quarter came in at $33.1 million, declining from $41.5 million in the same quarter of 2024, a drop management attributed to lower activity on certain Army programs. Gross margin declined from 25.9% to 22.4%, due largely to the absence of several higher-margin contracts present in the prior year.
Despite weaker revenue and margin trends, BigBear.ai reported net income of $2.5 million for the quarter against a loss of $15.1 million a year earlier. This improvement did not stem from core operating strength but from favorable non-cash adjustments, particularly changes in derivative valuations. Adjusted EBITDA, which strips out these non-operating items, remained negative at $9.4 million, down from positive $900,000 in the year-ago quarter.
The most important development was on the balance sheet. BigBear.ai ended the quarter with a record cash and investments balance of roughly $715 million, including $456.6 million in cash. The company’s net positive cash and investments position reached nearly $575 million as of the quarter’s end, giving it substantial flexibility to pursue growth opportunities and acquisitions. This liquidity was supported by capital raised through at-the-market share offerings, which provided the company with financial stability and the firepower to act on its M&A strategy.
Ask Sage: A Transformative Bet on Secure Generative AI
Central to BigBear.ai’s long-term strategy is its definitive agreement to acquire Ask Sage, a fast-growing generative AI platform designed specifically for highly regulated and classified environments. Management emphasized during the earnings call that Ask Sage already supports more than 100,000 users across 16,000 government teams and delivers secure, model-agnostic AI capabilities that integrate with major commercial and open-source models. Annual recurring revenue or ARR is on track to reach approximately $25 million in 2025, representing a sixfold increase from 2024.
The platform stands out because it provides a secure way for defense and national security agencies to access the best frontier AI models without compromising data confidentiality. The investor presentation notes that Ask Sage holds FedRAMP High accreditation and integrates seamlessly with providers such as OpenAI, Anthropic, Google and AWS. This allows BigBear.ai’s customers to operate across multiple security levels and classification environments.
On the third quarter of 2025 earnings call, CEO Kevin McAleenan called the acquisition a watershed moment, emphasizing that BigBear.ai would gain not just new capabilities but a ready-to-scale ecosystem already embedded within critical U.S. defense infrastructure. He highlighted Ask Sage’s adoption across agencies such as the U.S. Space Force, NAVAIR, the Defense Health Agency and several combatant commands, positioning BigBear.ai to accelerate its presence in mission-critical AI applications.
The acquisition is expected to close in late 2025 or early 2026, with the company signaling that the primary financial impact will be evident in 2026 and beyond.
Growing Opportunities in National Security and Secure Travel
Beyond Ask Sage, BigBear.ai continues to expand across national security and travel-and-trade markets. The company made progress in biometric deployments, with the company’s VeriScan platform now operating at major airports including Chicago O’Hare, Seattle-Tacoma and Nashville. These implementations strengthen BigBear.ai’s reputation in secure travel infrastructure, an area where global demand is rising due to increasing security requirements and digital identity initiatives.
In national security, the company continued to advance platforms such as Conductor OS and Bain, which provide situational awareness and logistics support in multi-domain operations. The management team highlighted successful trials in the United Kingdom and ongoing initiatives in the Middle East, demonstrating the company’s international reach. Meanwhile, its partnership with the Washington Commanders, which includes naming rights for the BigBear.ai Performance Center, adds a new dimension to its brand visibility.
The company’s emphasis on the “One Big Beautiful Bill”—a major bundle of federal security and technology funding—suggests that BigBear.ai anticipates expanded contracting opportunities as these programs materialize over the next several years.
BigBear.ai’s Challenges: Government Exposure
Government dependency adds risk. Some contracts, particularly within the intelligence community, were temporarily paused during the government shutdown, creating short-term disruptions to revenue and staffing. Management acknowledged that federal appropriations uncertainty can create unpredictable timing for contract activations and renewals.
Share dilution is another issue. The company issued a significant number of new shares during the third quarter to raise capital, improving liquidity but diluting existing shareholders. The need to execute the Ask Sage integration effectively while navigating uneven government spending adds further complexity.
BBAI Stock Valuation: Elevated From Historical Levels but Still Reasonable
BigBear.ai currently trades at a forward 12-month price-to-sales (P/S) ratio of 14.88. This represents a discount relative to the broader industry’s 16.43X but is far above the company’s three-year median of 2.17X. Still, the valuation is not unreasonable compared with other early-stage AI companies operating in high-growth, high-security markets. Investors appear to be pricing in the potential upside from Ask Sage and the company’s growing role in secure AI infrastructure.
BBAI’s P/S Ratio (Forward 12-Month) vs. Industry
Image Source: Zacks Investment Research
Where BigBear.ai Stands in the Evolving AI Defense Landscape
BigBear.ai increasingly competes with Palantir Technologies (PLTR - Free Report) , a dominant force in AI-driven defense analytics. Palantir continues to expand its government pipeline, and Palantir remains a critical benchmark for secure AI adoption. As BigBear.ai pushes deeper into national security and generative AI, Palantir remains the closest comparison in scale and mission focus.
Another notable competitor is C3.ai (AI - Free Report) . C3.ai maintains a strong positioning in enterprise AI, and C3.ai has emphasized rapid adoption of AI suites across regulated industries. While BigBear.ai strengthens its platform through Ask Sage, C3.ai continues to capture commercial AI spending.
Again, Leidos (LDOS - Free Report) remains deeply entrenched in government contracting, and Leidos benefits from massive multi-year federal programs. As BigBear.ai scales and secures new contracts, Leidos will continue to be a major competitor due to its established defense footprint.
Conclusion
BigBear.ai’s six-month rally reflects strengthening fundamentals and rising optimism around its role in secure AI for national security and regulated industries. The improved balance sheet, narrowing losses and transformative Ask Sage acquisition all contribute to a stronger long-term growth outlook.
At the same time, the company remains in a transitional phase. Revenue softness, negative adjusted EBITDA, contract timing risks and integration challenges require careful monitoring. For investors with a long-term horizon and tolerance for volatility, BigBear.ai offers a compelling opportunity in a fast-expanding market. For those seeking steadier near-term performance, patience may be required as this Zacks Rank #2 (Buy) company navigates 2025 and builds toward stronger growth in 2026. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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BigBear.ai Stock Rises 36% in 6 Months: Is It Still a Buy?
Key Takeaways
BigBear.ai Holdings, Inc. (BBAI - Free Report) has enjoyed a sharp rebound over the past six months, rising nearly 36% and outperforming major benchmarks, including the S&P 500, the Zacks Computer and Technology sector and even the Zacks Computers – IT Services industry. With the stock trading around $5.79 (as of Dec. 2) and remaining well above its 200-day moving average, investors are weighing whether the rally still has room to run or if the upside is starting to plateau.
The company’s recent momentum is supported by improving earnings expectations, a strengthened balance sheet and a potentially transformative acquisition. Yet it also faces challenges, including revenue pressure, government funding uncertainty and execution risk.
BBAI Stock’s 6-Month Performance
Image Source: Zacks Investment Research
Momentum Strengthened by Technically Positive Trends
Over the past half-year, BigBear.ai stock’s performance has been supported by a marked improvement in investor sentiment and a favorable technical setup. The chart shows that the stock is trading well above its 200-day moving average, which stands near $5.29, indicating a constructive long-term uptrend. At the same time, shares now sit slightly below the 50-day moving average of about $6.75, reflecting a short-term pause following a strong run.
The stock’s technical setup in 2025 has been volatile. The chart shows a sharp jump in February, followed by a long consolidation phase through spring. Momentum returned in July, with a steady climb into September and October, reflecting rising investor confidence as BigBear.ai outlined its acquisition plans and capital-raising efforts. The recent pullback places the stock in a zone where volume has risen meaningfully—near 60 million shares on Dec. 2, according to the chart data. This surge in trading activity aligns with heightened interest around the Ask Sage acquisition and the company’s strengthened liquidity position.
Image Source: Zacks Investment Research
Earnings Expectations Support the Uptrend for BBAI Stock
BigBear.ai stock’s performance has been bolstered by a meaningful shift in analyst forecasts. Over the past month, expectations for the company’s 2025 loss per share narrowed from $1.10 to 93 cents, while the anticipated 2026 loss per share improved from 32 cents to 25 cents. The company had previously posted a loss of $1.10 in the year-ago period, making the projected trajectory one of steady improvement rather than abrupt transformation.
Revenue expectations show a mixed picture. Analysts anticipate a 16.1% revenue decline in 2025, reflecting lingering weakness in certain government programs. However, the Zacks Consensus Estimate forecasts a 30.2% rebound in 2026, reflecting management’s confidence that delayed contracts, new government funding cycles and recent strategic moves will begin to contribute more meaningfully. The combination of strong share-price gains and narrowing loss expectations helps explain why the stock has significantly outpaced its industry and sector peers.
Financial Profile Strengthened by Record Cash Levels
The company’s third-quarter 2025 results underscored both operational challenges and financial progress. Revenues for the third quarter came in at $33.1 million, declining from $41.5 million in the same quarter of 2024, a drop management attributed to lower activity on certain Army programs. Gross margin declined from 25.9% to 22.4%, due largely to the absence of several higher-margin contracts present in the prior year.
Despite weaker revenue and margin trends, BigBear.ai reported net income of $2.5 million for the quarter against a loss of $15.1 million a year earlier. This improvement did not stem from core operating strength but from favorable non-cash adjustments, particularly changes in derivative valuations. Adjusted EBITDA, which strips out these non-operating items, remained negative at $9.4 million, down from positive $900,000 in the year-ago quarter.
The most important development was on the balance sheet. BigBear.ai ended the quarter with a record cash and investments balance of roughly $715 million, including $456.6 million in cash. The company’s net positive cash and investments position reached nearly $575 million as of the quarter’s end, giving it substantial flexibility to pursue growth opportunities and acquisitions. This liquidity was supported by capital raised through at-the-market share offerings, which provided the company with financial stability and the firepower to act on its M&A strategy.
Ask Sage: A Transformative Bet on Secure Generative AI
Central to BigBear.ai’s long-term strategy is its definitive agreement to acquire Ask Sage, a fast-growing generative AI platform designed specifically for highly regulated and classified environments. Management emphasized during the earnings call that Ask Sage already supports more than 100,000 users across 16,000 government teams and delivers secure, model-agnostic AI capabilities that integrate with major commercial and open-source models. Annual recurring revenue or ARR is on track to reach approximately $25 million in 2025, representing a sixfold increase from 2024.
The platform stands out because it provides a secure way for defense and national security agencies to access the best frontier AI models without compromising data confidentiality. The investor presentation notes that Ask Sage holds FedRAMP High accreditation and integrates seamlessly with providers such as OpenAI, Anthropic, Google and AWS. This allows BigBear.ai’s customers to operate across multiple security levels and classification environments.
On the third quarter of 2025 earnings call, CEO Kevin McAleenan called the acquisition a watershed moment, emphasizing that BigBear.ai would gain not just new capabilities but a ready-to-scale ecosystem already embedded within critical U.S. defense infrastructure. He highlighted Ask Sage’s adoption across agencies such as the U.S. Space Force, NAVAIR, the Defense Health Agency and several combatant commands, positioning BigBear.ai to accelerate its presence in mission-critical AI applications.
The acquisition is expected to close in late 2025 or early 2026, with the company signaling that the primary financial impact will be evident in 2026 and beyond.
Growing Opportunities in National Security and Secure Travel
Beyond Ask Sage, BigBear.ai continues to expand across national security and travel-and-trade markets. The company made progress in biometric deployments, with the company’s VeriScan platform now operating at major airports including Chicago O’Hare, Seattle-Tacoma and Nashville. These implementations strengthen BigBear.ai’s reputation in secure travel infrastructure, an area where global demand is rising due to increasing security requirements and digital identity initiatives.
In national security, the company continued to advance platforms such as Conductor OS and Bain, which provide situational awareness and logistics support in multi-domain operations. The management team highlighted successful trials in the United Kingdom and ongoing initiatives in the Middle East, demonstrating the company’s international reach. Meanwhile, its partnership with the Washington Commanders, which includes naming rights for the BigBear.ai Performance Center, adds a new dimension to its brand visibility.
The company’s emphasis on the “One Big Beautiful Bill”—a major bundle of federal security and technology funding—suggests that BigBear.ai anticipates expanded contracting opportunities as these programs materialize over the next several years.
BigBear.ai’s Challenges: Government Exposure
Government dependency adds risk. Some contracts, particularly within the intelligence community, were temporarily paused during the government shutdown, creating short-term disruptions to revenue and staffing. Management acknowledged that federal appropriations uncertainty can create unpredictable timing for contract activations and renewals.
Share dilution is another issue. The company issued a significant number of new shares during the third quarter to raise capital, improving liquidity but diluting existing shareholders. The need to execute the Ask Sage integration effectively while navigating uneven government spending adds further complexity.
BBAI Stock Valuation: Elevated From Historical Levels but Still Reasonable
BigBear.ai currently trades at a forward 12-month price-to-sales (P/S) ratio of 14.88. This represents a discount relative to the broader industry’s 16.43X but is far above the company’s three-year median of 2.17X. Still, the valuation is not unreasonable compared with other early-stage AI companies operating in high-growth, high-security markets. Investors appear to be pricing in the potential upside from Ask Sage and the company’s growing role in secure AI infrastructure.
BBAI’s P/S Ratio (Forward 12-Month) vs. Industry
Image Source: Zacks Investment Research
Where BigBear.ai Stands in the Evolving AI Defense Landscape
BigBear.ai increasingly competes with Palantir Technologies (PLTR - Free Report) , a dominant force in AI-driven defense analytics. Palantir continues to expand its government pipeline, and Palantir remains a critical benchmark for secure AI adoption. As BigBear.ai pushes deeper into national security and generative AI, Palantir remains the closest comparison in scale and mission focus.
Another notable competitor is C3.ai (AI - Free Report) . C3.ai maintains a strong positioning in enterprise AI, and C3.ai has emphasized rapid adoption of AI suites across regulated industries. While BigBear.ai strengthens its platform through Ask Sage, C3.ai continues to capture commercial AI spending.
Again, Leidos (LDOS - Free Report) remains deeply entrenched in government contracting, and Leidos benefits from massive multi-year federal programs. As BigBear.ai scales and secures new contracts, Leidos will continue to be a major competitor due to its established defense footprint.
Conclusion
BigBear.ai’s six-month rally reflects strengthening fundamentals and rising optimism around its role in secure AI for national security and regulated industries. The improved balance sheet, narrowing losses and transformative Ask Sage acquisition all contribute to a stronger long-term growth outlook.
At the same time, the company remains in a transitional phase. Revenue softness, negative adjusted EBITDA, contract timing risks and integration challenges require careful monitoring. For investors with a long-term horizon and tolerance for volatility, BigBear.ai offers a compelling opportunity in a fast-expanding market. For those seeking steadier near-term performance, patience may be required as this Zacks Rank #2 (Buy) company navigates 2025 and builds toward stronger growth in 2026. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.