Key Points
- After the post-profit weakness, BBAI's P/S ratio of 11.81 is much lower than the industry average.
- BigBear.ai holds $390 million in cash and $380 million in backlog, supporting mergers and acquisitions and federal contract execution.
- Despite recent revenue pressures, policy funds and global aggregates are the position of long-term AI growth.
BigBear.ai Holdings, Inc. (bbai Quick Quotebbai – Free Report) Operating at the intersection of national security, border technologies and AI, these findings are potentially unbalanced discoveries of unbalanced capital flows, but after ensuring that growth is possible. After the first half of the volatility of the first half, the stock reset from its early peak, bringing the valuation multiple below previous highs and inviting investors to re-look at power risks and options investors. BigBear.ai's forward 12-month price-to-P/S ratio is currently 11.81, which is well below the Zacks Computers – the IT services industry average of 17.04, indicating a relatively underestimation.
Bbai's P/S ratio (first 12 months) vs. industry
Image source: Zacks Investment Research
Valuation of BBAI Stocks and Peers
Compared to peers in AI, national security and defense technology, BigBear.ai appears to trade at a discount of forward revenue multiples. Palantir (PLTR fast quotationpltr – Free Report) is a heavyweight, with deep-rooted government links that direct 79.13 times the first 12 months of sales, while BigBear.ai is below that threshold. However, the company still trades at high prices C3.AI (AI fast quoteAI – Free Report), value is 7.05 times, sales are 7.05 times.
The in-depth integration of Palantir with defense and intelligence agencies, and its scale in mission-critical analysis, gives it a strong advantage in ensuring meaningful OB3 allocation. Meanwhile, C3.ai stands out from a wide range of suites in defense preparation, predictive maintenance and logistics, directly overlapping with BigBear.ai’s pursuit. As the reputation grows stronger, both Palantir and C3.ai have brought huge challenges, setting high standards for BigBear.ai.
Performance of BBAI Stock
BigBear.ai shares have been turbulent after Q2 2025 earnings due to disappointing revenue, lower guidance and widening losses. However, after bottoming out, BBAI shares showed moderate strength in late August and September. The campaign to $5.06 by September 12 showed that some sales pressures were alleviated, probably because investors reassessed the worst and responded to any incremental positive signals. BBAI shares have risen 22.2% over the past three months, outperforming the industry, the broader Zacks computer and technology sectors, and the S&P 500. Last year, BBAI stock still made great gains, up 220%.
Bbai's 3-month performance
Image source: Zacks Investment Research
Balance sheet firepower: BBAI's strategic positive
For those who have recently headwinds, Bigbear left the second quarter with a record $390.8 million in cash and cash equivalents, reporting a $380 million backlog. This liquidity (which is unreasonable for a company of size) is an organic investment for management offices, weather timing gaps in federal awards, and a pursuit of targeted mergers and acquisitions to deepen the orchestration of moat areas such as computer vision and tactical edges at the border.
Drivers: Why the long game still attracts people
AI that can perform tasks in a priority domain: BigBear's stack is used for real-time decision-making intelligence in sensitive environments (wide edge crossover, port, defense network) with accuracy and latency that are not negotiable. Contoros is its AI/data/sensor orchestration platform that targets emerging needs to coordinate heterogeneous edge devices in a modern war space, a topic that may sustain demand as defense plans range from pilots to production.
The end of policy and the theory of funding: A large bill (OB3) has created a generational investment cycle through the core area of BigBear.ai. The bill allocates $170 billion to the Department of Homeland Security, which includes $6.2 billion in border technology and $673 million in biometric exit solutions, as well as $150 billion in DOD, and provides AI Autonomy with $16 billion in $16 billion for shipbuilding. BigBear.ai has embedded these areas. Its veriscan biometric solution is deployed on over 2,000 devices across 25 airports, while COTTOROS demonstrates battlefield utilities in a drone swarm. In terms of logistics, shipyard AI is directly consistent with OB3's shipbuilding funds. With federal procurement accelerating, these alignments make bigbear.ai an advantage in the first step.
Backlog and contraction momentum: Even though some Army programs have caused turmoil, Bigbear continues to cite a large backlog and previous multi-year awards (e.g., GFIM-OE production contracts announced late 2024), indicating established customer relationships and follow-up range platforms. The execution of this book, rather than just a headline transaction announcement, will be a tangible driver of visibility in 2026-2027.
In addition to the U.S. opportunity, BigBear.ai is strengthening global relevance. The UAE partnership reached US$1.4 trillion, highlighting the need for critical infrastructure and security products. The company also launched Narval Holdings’ cargo security solutions in Panama, opening the door to the wider Latin American trade network. This partnership not only diversifies revenue streams, but also reduces reliance on a handful of large U.S. government contracts.
Key Challenge: What Can Make Multiple Limits
Contract timing and visibility: The same federal modernization efforts with long-term opportunities for opening up have caused recent damage. The Army's merger of data platforms reduced near-term revenue visibility, causing management to cut revenue guidelines for 2025 to $12.5-140 million and withdraw EBITDA Outlook. This emphasizes that profitability depends on the timing of rewards and mixing, i.e. factors, mostly beyond the company's control. This uncertainty can suppress multiples until the reward conversion and the range normalizes.
Profitability and cost discipline: Adjusted EBITDA losses expanded in the second quarter, with R&D and growth investments paying attention to recent results. Despite Cash Cushion’s purchase of time, investors will want to see operational leverage from scale projects or portfolios of services to move to higher revision efforts. Progress here is likely to be a catalyst for ongoing reevaluation, rather than rallies on the headlines.
Estimate the trend of BigBear.ai stock
Analysts have become increasingly pessimistic in recent weeks. The consensus on the Zacks consensus estimate for a loss per share in 2025 has expanded dramatically, from an estimated loss of 41 cents to a deeper loss of $1.10 over the past 60 days. The company reported the same situation a year ago.
This trend suggests profitability is out of range and cost pressures may continue to intensify.
Image source: Zacks Investment Research
Conclusion: Holding stocks with long-term earnings
BigBear.ai's second-quarter results highlighted the volatility of federal contract dependencies, but also highlighted the company's financial flexibility and strategic positioning. The stock is backed by unrivaled cash reserves, direct exposure to historical AI and defense spending, and strengthening international partnerships, relative to its discounted deals for its long-term potential.
That is, recent revenue visibility is still blinded by the resetting of the Army contract, negative EBITDA and guidance uncertainty. For investors seeking a balance of risk and opportunity, BigBear.ai is still better off seeing it as a long-term speculative game with asymmetric upward potential rather than a story of near-term gains.
Zacks ranked 3 (hold), stocks deserve patience. Investors should maintain their position, focus on signs of contract victory, increase margin and disciplinary capital deployment to unlock their hidden opportunities. You can see The full list of today's Zacks #1 ranking (forced buy) stocks.