BigBear.ai: The Next Palantir or Overvalued AI Stock?

The Next Palantir? Does This Under $5 AI Stock Have The Potential To Rise And Shine - BigBear.ai Hldgs (NYSE:BBAI), Palantir Technologies (NASDAQ:PLTR)

This micro-cap AI stock is being increasingly touted as the next Palantir Technologies Inc. PLTR, but some analysts disagree with this framing. What Happened: On Monday, BigBear.ai Holdings BBAI, which focuses on artificial intelligence and analytics primarily for defense and government contracts, was hit with a class-action lawsuit by investors, aimed at recovering losses arising due to alleged securities fraud between March 31, 2022, and March 25, 2025. The complaint alleges that deficient accounting practices, alongside the improper accounting of convertible notes, led to losses for investors, which it seeks to recover. This comes during a volatile couple of months for the stock, starting with a 146% rally from January through February, followed by a 62% pullback, amid growing financial turbulence and legal scrutiny. See Also: Amazon To Invest $20 Billion In 2 Pennsylvania Data Centers, Governor Josh Shapiro Says The State Will 'Lead' On US-China AI 'Battle' Analysts remain cautiously optimistic on the stock, with an average consensus price target of $4.63 per share, representing an upside of 18.71% from current prices. William Blair analyst, Louie DiPalma, has reiterated a "Neutral" stance on the stock, citing funding and guidance-related issues, reported TipRanks. Cantor Fitzgerald analyst Jonathan Ruykhaver reduced his price target from $8 to $6 but retained an "Overweight" rating. Ruykhaver believes recent contracts with the Navy and the Department of Defense's Chief Digital and Artificial Intelligence Office (CDAO) could provide meaningful growth opportunities if federal budgets stabilize. According to research by The Motley Fool, the company is expected to underperform for the next five years, primarily due to 40% of revenue being tied to the Federal Government, making it vulnerable to budget cuts and policy changes. Pre-IPO Offer: Get A Piece Of A Nearly $5T Global Opportunity By Joining BOXABL As An Early Shareholder At Just $0.80/Share Massive Demand & Disruptive Potential - Boxabl has received interest for over 190,000 homes, positioning itself as a major disruptor in the housing market. Revolutionary Manufacturing Approach - Inspired by Henry Ford's assembly line, Boxabl's foldable tiny homes are designed for high-efficiency production, making homeownership more accessible. Affordable Investment Opportunity - With homes priced at $60,000, Boxabl is raising $1 billion to scale production, offering investors a chance to own a stake in its growth. Share Price: $0.80 Min. Investment: $1,000 Valuation: $3.5B Click Here To Invest For Just $0.80/Share ($1000 Min) Why It Matters: During its first quarter results last month, the company reported $34.76 million in revenue, missing estimates at $36.26 million, followed by a loss of $0.26 per share, significantly higher than consensus estimates at $0.06 per share. The stock has a relative strength index (RSI) of 52.96, which puts it in the Neutral category, meaning that it's neither overbought nor oversold. Price Action: Shares of BigBear.AI were up 1.30% on Monday, trading at $3.90, and are up 0.51% after hours, according to data from Benzinga Pro. According to Benzinga's Edge Stock Rankings, the stock scores well on Momentum, has a favorable price trend in the short and long terms, but not in the medium term. Click here for deeper insights into the stock. Read More: Nvidia's Jensen Huang Once Called Huawei China's Most Formidable Tech Company, But CEO Ren Zhengfei Says Its Chips Still Lag Behind US Rivals Photo: Sundry Photography / Shutterstock BBAIBigBear.ai Holdings Inc$3.910.26%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum96.54GrowthNot AvailableQualityNot AvailableValue20.85Price TrendShortMediumLongOverviewPLTRPalantir Technologies Inc$131.26-0.61%Market News and Data brought to you by Benzinga APIs

Should You Buy BigBear.ai Stock Today? | The Motley Fool

Advances in artificial intelligence (AI) are rapidly transforming the global economy by automating complex workflows and delivering predictive insights that unlock unprecedented levels of productivity. BigBear.ai (BBAI 0.78%) is a prime example of an emerging leader in the field that deserves a closer look by investors. The technology sector small-cap is developing AI-powered decision intelligence solutions positioned to capitalize on a significant long-term growth opportunity. Does a promising outlook for BigBear.ai make its stock a good buy for your portfolio today? Here's what you need to know. While most companies are rushing to add artificial intelligence features to their existing product offerings, BigBear.ai stands out as a pure play on the transformative technology at the core of its data analytics platform. The company has carved out a niche specializing in operationalizing AI and machine learning capabilities for mission-critical intelligence and national defense applications. Through high-profile clients such as the U.S. Department of Homeland Security and the U.S. Army, BigBear.ai has gained credibility as a defense tech innovator in areas like autonomous systems, cybersecurity, and intelligent supply chain management. Perhaps even more exciting are the ongoing efforts to leverage this expertise in enterprise AI and the private sector as a new growth driver. Within digital identity services, several airlines and airports worldwide already rely on its Vision AI technology, which combines real-time images with actionable insights. Products include "TrueFace" and "veriScan" verification systems that streamline the passenger screening process. The potential of vision AI extends beyond airports, with applications in supply chain logistics for warehouse inventory management and cargo inspection. Ultimately, BigBear.ai is positioning itself to capture growing AI demand across multiple industries. Despite the commercial momentum, BigBear.ai's financial results at the start of 2025 have been muted. The company reported first-quarter revenue of $34.8 million, a 5% year-over-year increase for the period ended March 31, reflecting new Department of Homeland Security contracts and wins in the Digital Identity business. This growth was offset by delays in government program funding for other initiatives. Increased spending, including on research and development efforts, led to an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $7 million, widening from a $1.6 million loss in the prior-year quarter. Management is projecting optimism in its outlook, citing "encouraging signs" that the strategic focus is resonating with customers. Favorably, its current order backlog of $385 million is up 30% from $296 million at the end of Q1 2024, suggesting room for stronger growth. BigBear.ai is guiding for full-year revenue between $160 million and $180 million, at the midpoint, representing an 8% increase from 2024. The company also expects its recurring loss to narrow, targeting 2025 adjusted EBITDA in the "negative single-digit millions." There's a lot to like about BigBear.ai as it moves to expand into new industry verticals and enter international markets. Yet, it's important to recognize that the stock remains a speculative investment, given the company's high price-to-sales (P/S) ratio, lack of profitability, and long-term uncertainties. Shares are down 63% from their 52-week high, underscoring underlying market skepticism regarding the company's potential. First, BigBear.ai will face intense competition from larger tech rivals pursuing many of the same market opportunities. Companies like Palantir Technologies, defense industry consultant Booz Allen Hamilton, and even cybersecurity giants have greater financial resources and pose challenges in both defense and commercial AI applications. Second, it's unclear whether BigBear.ai's proprietary technology can maintain its innovative edge. Furthermore, while BigBear.ai's modest growth outlook is a step in the right direction, the market will likely want to see evidence of accelerating trends to drive the stock price higher. The possibility that results disappoint and that any timetable for generating consistent profitability gets pushed out would likely keep the stock volatile -- a risk for investors to balance. The next several quarters will be pivotal for BigBear.ai to demonstrate its commercial traction and the success of its growth initiatives. Without a major catalyst on the horizon, I believe the prudent move for investors is to adopt a wait-and-see approach before buying the stock. Ultimately, there may be more compelling AI stocks with a better combination of growth and value available elsewhere.