BigBear.ai's Stock Pullback Is An Opportunity, Analyst Remains Bullish Citing 'Enough Positives'

HC Wainwright analyst Scott Buck reiterated the Buy rating on BigBear.ai BBAI, lowering the price forecast to $6 from $7.

The analyst highlighted softer 2025 expectations amid potential delays and disruptions due to administration transition.

Meanwhile, the analyst writes that, in the long term, the markets BigBear.ai serves will see increased investment in sectors such as border security, defense, intelligence, and critical infrastructure.

Furthermore, the company is anticipated to gain from the Department of Government Efficiency as a key enabler of government efficiency, Buck writes.

Another positive aspect highlighted is BigBear.ai’s significant de-leveraging earlier this year, achieved through corporate actions such as warrant conversion and exchanging convertible notes, which has notably improved its financial position.

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As a result, the company now holds around $115.0 million in cash and has reduced its debt-to-cash ratio from 4.0x at the end of 4Q24 to 1.2x. The analyst views these moves as removing a substantial obstacle for BBAI shares.

The analyst suggests that these positive developments could make any potential stock pullback an opportunity to accumulate a holding.

Buck has revised the 2025 revenue estimate to $165.0 million, a decrease from the prior projection of $200.0 million, although it remains within the company’s guided range of $160.0 million to $180.0 million.

Despite the lower revenue expectations, the analyst notes that these are partially offset by a higher-than-expected gross margin and lower operating expenses than initially forecasted.

Consequently, Buck is modeling an adjusted EBITDA loss of $5.5 million for 2025.

Additionally, the analyst is introducing an initial forecast for 2026, expecting revenue to reach $190.0 million and adjusted EBITDA to be positive at $4.5 million.

Price Action: BBAI shares are trading lower by 19.8% to $3.37 at last check Friday.

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