BigBearai Holdings (BBAI) AI Stock Analysis

• Market Cap: $946.36M
• Dividend Yield: N/A
• Average Volume (3M): 52.93M
• Price to Earnings (P/E): ―
• Beta (1Y): 3.01
• Revenue Growth: 9.40%
• EPS Growth: 13.55%
• Country: US
• Employees: 630
• Sector: Technology
• Sector Strength: 65
• Industry: Information Technology Services
• EPS (TTM): -0.25
• Shares Outstanding: 291,188,800
• 10 Day Avg. Volume: 63,904,107
• 30 Day Avg. Volume: 52,928,728
• PEG Ratio: -0.12
• Price to Book (P/B): 4.07
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -23.23
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $4.83
• Price Target Upside: 48.62% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

BigBearai Holdings faces significant challenges with profitability and cash flow, which are key concerns, despite revenue growth and a solid cash position. The technical indicators point to a lack of momentum, and valuation remains a concern due to ongoing losses. The earnings call provided some positive strategic insights, but financial difficulties continue to weigh heavily on the stock's attractiveness.

Positive Factors

Contract Awards

BigBear was awarded a $165 million, 5-year contract for the U.S. Army Global Force Information Management (GFIM) Production Services.

Financial Health

The company meaningfully de-levered its balance sheet through a series of corporate actions, including warrant conversion and an exchange of outstanding convertible notes.

Partnerships

BigBear’s partnership with L3Harris as the exclusive provider of computer vision, predictive analytics, and event alerting analytics applications for L3Harris’s autonomous surface vessels remains a positive.

Negative Factors

Future Growth Outlook

The revenue outlook for 2025 of between $160.0M and $180.0M suggests only modest revenue growth, just 7.4% at the midpoint and compared to current Street estimates of $193.9M.

Market Response

Shares of BigBear.ai are trading down over 20% after the company reported fourth-quarter results below consensus and issued 2025 guidance below expectations.

Revenue Performance

Revenue of $43.8M was well below the Street’s $54.6M estimate resulting in the company missing its full year guide of between $165.0M and $180.0M.

BigBearai Holdings Business Overview & Revenue Model

Company Description

BigBear.ai Holdings, Inc. provides artificial intelligence and machine learning for decision support. The company operates through two segments, Cyber & Engineering and Analytics. The Cyber & Engineering segment offers high-end technology and management consulting services. It focuses in the areas of cloud engineering and enterprise IT, cybersecurity, computer network operations and wireless, systems engineering, and strategy and program planning. The Analytics segment provides high-end technology and consulting services. This segment focuses on the areas of big data computing and analytical solutions, including predictive and prescriptive analytics solutions. Its solutions assist customers in aggregating, interpreting, and synthesizing data to enable real-time decision-making capabilities. The company is headquartered in Columbia, Maryland.

How the Company Makes Money

BigBear.ai Holdings generates revenue through the sale of its AI and analytics software solutions, which are provided to customers on a subscription basis or through one-time licensing fees. The company also earns income from offering consulting and professional services, helping clients implement and optimize their AI strategies. Key revenue streams include long-term contracts with government agencies, particularly in the defense sector, as well as partnerships with commercial enterprises looking to leverage AI for competitive advantage. Significant partnerships and collaborations with technology firms and government entities further bolster its earnings by expanding its market reach and enhancing its product offerings.

BigBearai Holdings Financial Statement Overview

Summary

BigBearai Holdings is experiencing growth in revenue but faces challenges with profitability and cash generation. The balance sheet shows improvements in equity, but cash flows remain a concern, highlighting the need for better operational efficiency and cash management to ensure long-term sustainability. The reliance on external financing could pose risks if not managed carefully.

Income Statement

BigBearai Holdings shows a consistent increase in revenue over the years, with a 3.1% increase from 2023 to TTM (Trailing-Twelve-Months). However, the company has struggled with profitability, as evidenced by negative EBIT, EBITDA, and net income margins. The net profit margin for TTM is significantly negative, indicating challenges in cost management or operational efficiency.

Balance Sheet

The company's balance sheet reflects a high level of equity compared to total assets, with an equity ratio of 49.9% for TTM. However, the debt-to-equity ratio is low at 0.05, suggesting limited leverage. The company has improved its stockholders' equity significantly from negative figures in previous years, indicating a positive trend in financial stability.

Cash Flow

BigBearai Holdings has shown negative operating and free cash flows consistently, which is a concern for liquidity. The free cash flow growth rate has been negative, and the operating cash flow to net income ratio for TTM is not favorable, reflecting challenges in generating cash from core operations. Despite this, financing activities have provided substantial cash inflows, possibly from debt or equity financing.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
159.87M	158.24M	155.16M	155.01M	145.58M	91.32M
	Gross Profit
45.62M	45.22M	40.60M	42.99M	34.07M	21.68M
	EBIT
-54.09M	-45.68M	-39.03M	-50.17M	-78.47M	-34.10K
	EBITDA
-38.17M	-45.68M	-37.57M	-101.02M	-107.44M	-34.10K
	Net Income Common Stockholders
-193.93M	-257.09M	-60.37M	-121.67M	-123.55M	-34.10K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
107.61M	50.14M	32.56M	12.63M	68.90M	9.70M
	Total Assets
396.27M	343.78M	199.91M	195.31M	383.32M	218.37M
	Total Debt
10.68M	146.41M	200.59M	200.28M	194.60M	106.99M
	Net Debt
-96.93M	96.27M	168.04M	187.64M	125.70M	97.29M
	Total Liabilities
198.47M	347.49M	267.25M	233.18M	260.95M	117.97M
	Stockholders Equity
197.79M	-3.71M	-67.33M	-37.87M	122.37M	100.40M
Cash Flow		Free Cash Flow
-39.94M	-38.60M	-22.14M	-49.69M	-20.43M	922.00K
	Operating Cash Flow
-30.42M	-38.12M	-18.31M	-48.92M	-19.78M	1.20M
	Investing Cash Flow
-11.05M	2.82M	-3.83M	-5.23M	-863.00K	-184.99M
	Financing Cash Flow
67.44M	52.46M	42.06M	-103.14M	180.86M	192.22M

BigBearai Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.25
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBAI, the sentiment is Positive. The current price of 3.25 is above the 20-day moving average (MA) of 3.03, above the 50-day MA of 3.20, and above the 200-day MA of 2.93, indicating a bullish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 51.55 is Neutral, neither overbought nor oversold. The STOCH value of 36.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BBAI.

BigBearai Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PAY	73 Outperform	$4.61B	93.03	10.80%	―	47.78%	74.61%
GDYN	72 Outperform	$1.29B	116.44	2.42%	―	18.72%	347.70%
HCKT	70 Outperform	$707.97M	29.99	23.13%	1.82%	3.96%	-31.63%
TASK	67 Neutral	$1.50B	28.14	11.35%	―	14.05%	17.90%
Sector *	60 Neutral	$11.39B	10.50	-6.42%	2.97%	7.77%	-11.17%
AI	53 Neutral	$3.10B	―	-32.07%	―	23.79%	4.10%
BBAI	41 Neutral	$946.36M	―	-126.64%	―	9.40%	13.55%

BigBearai Holdings Corporate Events

BigBear.ai Appoints Kevin McAleenan as New CEO

On January 15, 2025, BigBear.ai Holdings announced the appointment of Kevin McAleenan as the new Chief Executive Officer, succeeding Mandy Long. McAleenan, who has an extensive background in government and the AI industry, previously served as BigBear.ai’s President and co-founded Pangiam. His leadership is expected to enhance BigBear.ai’s position as a leading AI solutions provider, with a focus on national security imperatives, leveraging his deep understanding of national security priorities and challenges.