BigBear.ai Stock Surges 136% Amid AI Boom and Government Contracts

COLUMBIA, Md. — BigBear.ai, a leading artificial intelligence (AI) analytics company, has seen its stock soar 136% over the past six months, driven by strong financial performance and significant government contract wins. The company, which specializes in AI-powered solutions for defense and security, reported a 22.1% year-over-year revenue increase in the third quarter of 2024, reaching $41.5 million.

On Jan. 15, BigBear.ai appointed Kevin McAleenan as its new CEO. McAleenan, who previously served as acting secretary of the U.S. Department of Homeland Security, brings a wealth of experience in both government and private sectors. His leadership is expected to bolster the company’s presence in the defense and security markets, particularly following the acquisition of Pangiam, a company he co-founded, in 2024.

BigBear.ai’s recent financial results highlight its growing momentum. The company improved its gross margin to 25.9% in Q3 2024, up from 24.7% the previous year, thanks to a higher mix of commercial solutions and operational efficiencies. However, the quarter also saw a net loss of $12.2 million, primarily due to non-cash warrant valuation changes. Despite this, the company achieved positive adjusted EBITDA of $0.9 million and maintained a robust backlog of $437 million, signaling strong future revenue potential.

Government contracts have been a key driver of BigBear.ai’s success. The company recently secured a five-year, $165 million sole-source prime contract with the U.S. Army to provide advanced force management solutions powered by AI analytics. Additionally, BigBear.ai was awarded a subcontract under the Federal Aviation Administration‘s (FAA) Information Technology Innovative Procurement Strategic Sourcing program, a 10-year contract with a shared ceiling of $2.4 billion across 14 companies.

Despite these positive developments, investors should approach the stock with caution. BigBear.ai currently trades at 5.3 times trailing sales, significantly higher than its peer group average of 3.5 times. For those seeking exposure to the company with defined risk, a cash-secured put strategy may be a prudent alternative to direct stock purchases. For example, selling a January 2026 put option with a $3 strike price could generate $1.10 per share in premium income, offering a potential 37% return over 12 months if the stock remains above $3.

BigBear.ai’s combination of experienced leadership, improving financials, and expanding government contracts positions it as a promising player in the AI sector. However, after the stock’s recent surge, a cautious approach may be warranted to navigate the volatility of this high-growth market.