BigBear AI stock price has been in a strong bull run in the past few weeks, becoming one of the best-performing companies since April. The BBAI share price jumped to a high of $7.85 on Wednesday, its highest point since February 21. It has jumped by over 230% from its April low.
Why BigBear AI stock price jumped
BigBear AI is a top American company offering artificial intelligence solutions to the US government and companies. Its services mainly offer military and national security initiatives, cybersecurity, digital identity management, and computer vision.
BigBear stock price has surged in the past few weeks as investors rotated back to companies in the AI industry. For example, NVIDIA stock price has recently jumped by double digits and become the biggest company globally.
The stock also jumped as hopes that Donald Trump’s “Big Beautiful Bill” will pass in Congress. The Senate voted for the bill this week, and Trump has held talks with some of the holdouts.
If passed, this bill will be a boon to companies as it will boost spending by over $150 billion. Some of these funds will go towards the border initiatives and the so-called Golden Dome. It will also go towards military modernization initiatves, including on AI, an area that BigBear AI will benefit.
BigBear AI, like Palantir, is also working to boost its presence in other countries, a major move since it now provides its services to the US government.
Initiatives could boost growth
These initiatives will likely help to boost Bigbear’s growth that has stalled lately despite the ongoing AI hype. The most recent results showed that its revenue rose by just 5% in the first quarter to $34.8 million. Its backlog jumped by 30% to $384 million.
BBAI is still a loss-making company that lost over $2.6 million in the first quarter. Its gross margin also narrowed gradually.
Wall Street analysts anticipate that BigBear’s second quarter revenue rose by 3.52% in Q1 to over $41.1 million. It is then expected to make $44.6 million in the third quarter.
BigBear’s annual revenue is expected to be $167 million, up by 6.14% from last year, followed by $188 million in 2026.
The primary concern about Bigbear stock is that it is highly overvalued, given its market capitalization of over $2.2 billion, and its revenue growth is not strong enough.
The current stock price of $7.56 is also much higher than the average analysts estimate of $4.83.
BigBear stock price analysis
The daily chart shows that the BBAI share price has been in a strong bullish trend in the past few days. It has moved above the 38.2% Fibonacci Retracement level at $6.83.
BBAI stock remains much higher than the 50-day and 100-day moving averages. This presents the risk that it could suffer a harsh reversal known as mean reversion. Mean reversion is a phenomenon where an asset’s price drops and then returns to its historical average.
The BBAI stock price has also become highly overbought, with the Relative Strength Index (RSI) has moved to the overbought level. Therefore, there is a risk that the stock will pullback, with the next point to watch being at $5.
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