Why BigBear.ai Stock Skyrocketed 52.6% in the First Half of 2025 and Has Kept Surging
BigBear.ai has gotten a big boost as investors have become increasingly interested in defense artificial intelligence (AI) plays.
The company's most recent quarterly reports fell short of expectations, but investors are betting on future potential.
BigBear.ai has kept climbing in the second half of 2025 and could have breakout potential, but the company's valuation profile looks risky.
10 stocks we like better than BigBear.ai ›
BigBear.ai (NYSE: BBAI) stock recorded a huge rally across the first half of 2025. The company's share price surged 52.6% across the stretch, according to data from S&P Global Market Intelligence. Meanwhile, the S&P 500 's (SNPINDEX: ^GSPC) level increased roughly 5.5% across the same time frame.
Despite substantial volatility, BigBear.ai stock saw big gains across this year's first two quarters as investors continue to bet on artificial intelligence (AI) software and service providers. The company's share price has continued to see volatility in the second half of the year, but it's posted significant gains so far in July.
BigBear.ai stock surged as investors doubled down on AI plays
Artificial intelligence (AI) stocks have seen some big valuation swings in 2025's first half, but the cohort generally enjoyed bullish momentum. BigBear.ai started the year with some significant swings in January, and then went on to see a massive rally in February.
Despite volatility connected to the rollout of DeepSeek's R-1 AI model, Palantir stock also saw strong gains early in the year's trading. The company's positioning in defense-related AI software helped support bullish valuation momentum, and excitement surrounding the business also helped boost BigBear.ai's share price. Some investors drew parallels between the companies and pointed to BigBear.ai as a company with big growth opportunities in the defense software-and-services space, and the dynamic helped power a run-up for the company's stock.
While BigBear.ai has posted two somewhat underwhelming quarterly reports this year, that didn't stop its share price from notching strong gains in this 2025's first half. The company published results for the fourth quarter of its last fiscal year in March, with revenue increasing 8% year over year to $43.8 million and a loss of $0.43 per share in the period. The average Wall Street analyst estimate had called for a loss of roughly $0.05 per share on revenue of $54.6 million.
In May, the company published results for this year's first quarter -- posting sales and earnings for the period that fell short of Wall Street's targets. The business posted revenue of $34.8 million and a $0.25 loss per share. The average analyst estimate called for sales of approximately $36.3 million and a loss of $0.06 per share. Sales were up just 5% year over year in the period, and margins came in softer than anticipated, but the stock enjoyed a strong rally following the report as investors bet on opportunities in the defense AI space.
What's next for BigBear.ai?
Despite some volatility, BigBear.ai stock has continued to gain ground in this year's second half. The company's share price is up roughly 5% in this month's trading. Its valuation has gotten a boost from bullish analyst coverage and market momentum for defense AI plays.
With guidance for sales between $160 million and $180 million, the midpoint of BigBear's target calls for annual revenue growth of roughly 7.5% over the $158.2 million in sales it posted last year. Valued at roughly $2.1 billion, the company is priced at approximately 12.4 times the average analyst estimate's target for this year's sales. While it's possible that sales will accelerate substantially with new contract wins, the company's valuation relative to its rate of sales growth suggests the stock is a risky play right now.
Should you invest $1,000 in BigBear.ai right now?
Before you buy stock in BigBear.ai, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and BigBear.ai wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $679,653!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,046,308!*
Now, it's worth noting Stock Advisor's total average return is 1,060% — a market-crushing outperformance compared to 179% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor.
See the 10 stocks »
*Stock Advisor returns as of July 15, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
4 minutes ago
- Globe and Mail
Markets Await Consumer Sentiment Reading
Pre-market futures are up again as a very eventful trading week winds to a close. The Dow is currently +0.12%, the S&P 500 is +0.09% and the Nasdaq +0.16% at this hour. The small-cap Russell 2000 is shooting to another orbit this morning, +0.52%. It now leads all major indexes for the past week of trading, as it still tries to catch up with the other indexes year to date. Bond yields have remained fairly steady through a thorough barrage of economic reports Q2 earnings releases, and open speculation about the future tenure of Fed Chair Jerome Powell. The 10-year yield is up a mere 3 basis points (bps) from last Friday, +4.44%. The 2-year continues to shrink gradually, now +3.88%, while the 30-year remains hanging onto its recent 5-handle: +5.00%. Housing Starts & Building Permits Improve, Stay Muted Housing Starts for the month of June remained historically low, coming in slightly ahead of projections to 1.32 million seasonally adjusted, annualized units, up from 1.256 million the prior month, which was the worst performance on new housing starts in five years. Multi-year highs back in April 2022 were 500K higher than they are presently. Building Permits of 1.397 million were also up a bit month over month, from 1.394 million reported for May, which was the weakest level of permits for new homebuilding since June 2020. Back in January of 2022, we were close to 2 million building permits per month — but that was prior to the Fed raising interest rates, which directly sent mortgage rates surging higher. Q2 Earnings Beats for 3M, AmEx & Schwab Minnesota-based industrial conglomerate 3M (MMM) shares are up +3% on the company's beat-and-raise in its Q2 report ahead of today's opening bell. Earnings of $2.16 per share outshone the Zacks consensus of $2.01, for an earnings surprise of +7.46%. Revenues of $6.2 billion in the quarter improved over the $6.12 billion forecast. Earnings guidance for full-year 2025 was also raised to a range of $7.75-8.00 per share. American Express (AXP) also surpassed expectations in its Q2 report this morning, with earnings of $4.08 per share beating the $3.86 expected and the $3.49 per share posted in the year-ago quarter. Revenues of $17.9 billion topped the $17.69 billion estimate, for year-over-year growth of +9%. Shares are flat in today's pre-market, up +6.25% year to date. Financial services major Charles Schwab (SCHW) is having an even better morning, with shares up +5% in the pre-market, adding to its +26% growth year to date, with solid beats on both top and bottom lines in this morning's Q2 report. Earnings of $1.14 per share on revenues of $5.85 billion surged past the $1.09 per share and $5.70 billion, respectively, in the Zacks consensus. What to Expect from the Stock Market Today After today's open, we'll see a preliminary print on Consumer Sentiment for July. This is expected to improve to 61.8 from the prior read of 60.7, which tracks with the present narrative of a healthy environment. Q2 earnings season overall has provided a rosier outlook, and most of the fears of tariffs sandbagging the economy have dissipated. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They include Stock #1: A Disruptive Force with Notable Growth and Resilience Stock #2: Bullish Signs Signaling to Buy the Dip Stock #3: One of the Most Compelling Investments in the Market Stock #4: Leader In a Red-Hot Industry Poised for Growth Stock #5: Modern Omni-Channel Platform Coiled to Spring Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%. Download Atomic Opportunity: Nuclear Energy's Comeback free today. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report 3M Company (MMM): Free Stock Analysis Report American Express Company (AXP): Free Stock Analysis Report The Charles Schwab Corporation (SCHW): Free Stock Analysis Report
Globe and Mail
4 minutes ago
- Globe and Mail
J&J Expects Oncology Sales of USD 50B by 2030: Can It Achieve the Goal?
Johnson & Johnson JNJ, on its second-quarter conference call, stated that it expects its oncology sales to reach $50 billion by the end of the decade. Oncology, at present, comprises around 27% of J&J's total revenues. Its oncology sales rose 22.3% on an operational basis in the second quarter to $6.3 billion, driven by strong market growth and share gains of key products such as multiple myeloma treatment Darzalex and prostate cancer drug, Erleada. New cancer drugs, such as Carvykti, Tecvayli, Talvey and Rybrevant, plus Lazcluze, contributed significantly to growth as they witnessed strong launches. Though the $50 billion target was well above consensus, J&J seems quite confident in the target, citing strong growth in its marketed cancer drugs and the potential of upcoming launches like TAR-200 in bladder cancer and the subcutaneous formulation of Rybrevant plus Lazcluze for advanced EGFR-mutated non-small cell lung cancer (NSCLC). TAR-200 is under priority review with the FDA for treating non-muscle invasive bladder cancer and is expected to be approved this year. The subcutaneous formulation of Rybrevant plus Lazcluze has been recommended for approval in the EU while it is under review in the United States. Meanwhile, J&J's oncology pipeline has gained strong momentum in the last year and a half, with promising developments in colorectal and head and neck cancers. In this period, J&J had eight proof-of-concept readouts, which led the candidates to move to late-stage pivotal studies across the portfolio. If these pipeline drugs are eventually approved, they can also boost JNJ's oncology sales. In the five years from 2019 to 2024, J&J's oncology sales have doubled from $10.7 billion in 2019 to $20.8 billion in 2024. To achieve the $50 billion target in the next 5-6 years, the company needs to more than double its sales from 2024 levels. Though quite optimistic, the target is not unachievable. Competition in the Oncology Space Other large players in the oncology space are Pfizer PFE, AstraZeneca AZN, Merck MRK and Bristol-Myers. Pfizer boasts a strong portfolio of approved cancer medicines like Xtandi, Lorbrena and the Braftovi-Mektovi combination. The addition of Seagen in 2023 also strengthened its position in oncology by adding four ADCs — Adcetris, Padcev, Tukysa and Tivdak. Pfizer also has a robust pipeline of cancer candidates with a focus on multiple modalities, including small molecules, antibody-drug conjugates (ADCs) and immuno-oncology biologics. For AstraZeneca, oncology sales now comprise around 41% of total revenues. AstraZeneca's strong oncology sales growth is being driven by medicines such as Tagrisso, Lynparza, Imfinzi, Calquence and Enhertu (in partnership with Daiichi Sankyo). AstraZeneca is working on strengthening its oncology product portfolio through label expansions of existing products and progressing oncology pipeline candidates. Merck's key oncology medicines are PD-L1 inhibitor, Keytruda and PARP inhibitor, Lynparza, which it markets in partnership with AstraZeneca. Keytruda, approved for several types of cancer, alone accounts for around 50% of Merck's pharmaceutical sales. Bristol-Myers' key cancer drug is PD-LI1inhibitor, Opdivo, which accounts for around 20% of its total revenues. JNJ's Price Performance, Valuation and Estimates J&J's shares have outperformed the industry year to date. The stock has risen 14.6% in the year-to-date period compared with an increase of 1.5% for the industry. Image Source: Zacks Investment Research From a valuation standpoint, J&J is reasonably priced. Going by the price/earnings ratio, the company's shares currently trade at 14.97 forward earnings, slightly lower than 15.04 for the industry. The stock is also trading below its five-year mean of 15.70. The Zacks Consensus Estimate for 2025 earnings has risen from $10.60 per share to $10.66 over the past 30 days, while that for 2026 has risen from $10.98 to $11.13 over the same timeframe. J&J has a Zacks Rank #2 (Buy) currently. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They include Stock #1: A Disruptive Force with Notable Growth and Resilience Stock #2: Bullish Signs Signaling to Buy the Dip Stock #3: One of the Most Compelling Investments in the Market Stock #4: Leader In a Red-Hot Industry Poised for Growth Stock #5: Modern Omni-Channel Platform Coiled to Spring Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%. Download Atomic Opportunity: Nuclear Energy's Comeback free today. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AstraZeneca PLC (AZN): Free Stock Analysis Report Johnson & Johnson (JNJ): Free Stock Analysis Report Pfizer Inc. (PFE): Free Stock Analysis Report Merck & Co., Inc. (MRK): Free Stock Analysis Report
Globe and Mail
4 minutes ago
- Globe and Mail
Buy, Sell or Hold Alphabet Stock? Key Tips Ahead of Q2 Earnings
Alphabet GOOGL is set to report second-quarter 2025 results on July 23. For second-quarter 2025, the Zacks Consensus Estimate for earnings is pegged at $2.13 per share, up by a penny over the past 30 days and indicates 12.7% year-over-year growth. The consensus mark for second-quarter revenues is pegged at $79.22 billion, indicating growth of 11.02% from the year-ago quarter's reported figure. Alphabet has an impressive earnings surprise history. GOOGL's earnings outpaced the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 14.64%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) Alphabet Inc. Price and EPS Surprise Alphabet Inc. price-eps-surprise | Alphabet Inc. Quote Let's see how things have shaped up for the upcoming announcement: Growing AI Usage in Search to Aid GOOGL's Q2 Results Alphabet's to-be-reported quarterly results are expected to benefit from solid momentum in Search and Cloud businesses. The integration of Generative AI (Gen AI) technology into the search engine has been benefiting Google Search. AI-powered Circle to Search is now available on more than 300 million Android devices, with people using it to shop, translate text, and learn more about the world around them. Circle to Search is driving additional Search and is gaining popularity among younger users. The addition of AI mode expands AI Overview's advanced reasoning, thinking and multimodal capabilities. The Zacks Consensus Estimate for second-quarter 2025 Search and other revenues is pegged at $52.36 billion, indicating 8% growth over the figure reported in the year-ago quarter. GOOGL Cloud Gaining Market Share Alphabet has been rapidly growing in the booming cloud computing market. Google Cloud has solidified its position as the third-largest provider in the highly competitive cloud infrastructure market against Amazon 's AMZN cloud arm, Amazon Web Services (AWS), and Microsoft' s MSFT Azure. The solid adoption of the Google Cloud Platform and Google Workspace is expected to have driven growth in the Google Cloud segment. According to Synergy Research Group data, Google Cloud, along with Microsoft, is gaining market share, while AWS continues to lead with a 29% market share in the first quarter of 2025. Alphabet and Microsoft had 22% and 12% market share, respectively. The consensus mark for second-quarter 2025 Google Cloud revenues is pegged at $13.04 billion, indicating 26% growth over the figure reported in the year-ago quarter. However, GOOGL is suffering from a lack of capacity, and until new capacity comes online in 2025, cloud revenues are expected to see increased variability. This is expected to have hurt Alphabet's Google Cloud revenues in the to-be-reported quarter. GOOGL Shares Lag Sector, Industry Image Source: Zacks Investment Research Alphabet's shares have declined 3.1% year to date, underperforming the Zacks Internet Services industry and the Zacks Computer & Technology sector. Over the same timeframe, the sector has returned 9.5% while the industry has dropped 0.9%. GOOGL Stock's Performance GOOGL shares are overvalued, as suggested by Value Score C. Currently, GOOGL is trading at a premium, with a forward 12-month Price/Sales of 6.43X compared with the industry's 5.49X. Price/Sales Ratio (F12M) Technically, GOOGL shares are displaying a bullish trend as they trade above the 50-day and 200-day moving averages. GOOGL Trades Above 50-day & 200-day SMAs Cloud Growth to Drive GOOGL Prospects Alphabet is benefiting from an expanding clientele and rich partner base. Google Cloud is benefiting from its partnership with NVIDIA NVDA. Google Cloud was the first cloud provider to offer NVIDIA's B200 and GB200 Blackwell GPUs and will be offering its next-generation Vera Rubin GPUs. Google Cloud is becoming a preferred choice for enterprises planning to deploy AI agents thanks to the Agent Development Kit and a low-code tool offering Agent Designer. The addition of Wiz to Google Cloud will boost competitive prowess against the likes of Amazon and Microsoft in the cloud computing space. Google Cloud's expanding clientele is expected to boost Alphabet's top line. Google Cloud is now expanding its footprint based on the latest deals with Ecobank in Africa and BBVA. BBVA's deal with Google Cloud will enable Alphabet to deploy Google Workspace with Gemini across the global operations of the bank. Meanwhile, the Ecobank collaboration aims at transforming financial services with advanced analytics and AI and driving digital empowerment across Africa. This offers a significant growth opportunity for Google Cloud in one of the most underpenetrated regions of the globe. GOOGL Stock: Buy, Sell or Hold Ahead of Q2? Alphabet's growing Gen AI capabilities present a potential catalyst for future growth. Its dominant position in the Search market is a strong growth driver. However, a stretched valuation, stiff competition in the cloud space and growing regulatory headwinds make GOOGL shares risky for investors ahead of second-quarter 2025 results. Alphabet currently has a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for a more favorable entry point in the stock. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They include Stock #1: A Disruptive Force with Notable Growth and Resilience Stock #2: Bullish Signs Signaling to Buy the Dip Stock #3: One of the Most Compelling Investments in the Market Stock #4: Leader In a Red-Hot Industry Poised for Growth Stock #5: Modern Omni-Channel Platform Coiled to Spring Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%. Download Atomic Opportunity: Nuclear Energy's Comeback free today. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Inc. (AMZN): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report
