BigBear.ai (BBAI): Evaluating Valuation After High-Profile Defense AI Partnership at UNITAS 2025

BigBear.ai Holdings (NYSE:BBAI) is making waves after announcing a partnership with SMX to provide advanced AI technologies for UNITAS 2025, a high-profile multinational maritime exercise led by the U.S. Navy. This collaboration highlights the company’s growing influence in mission-based defense operations and could open doors to additional government contract opportunities.

See our latest analysis for BigBear.ai Holdings.

Momentum around BigBear.ai’s government partnerships has generated plenty of buzz, but share price returns have been more modest, with a 3.8% total shareholder return over the past year and the latest price settling at $7.19. The company’s stock still reflects ongoing optimism around its growing defense-related contracts, even as investors navigate volatility and concerns about shifting federal demand.

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With shares rebounding after the UNITAS announcement and optimism swirling around BigBear.ai's growing defense ties, investors now face a timely question: does the current price reflect all the upside, or is there hidden value still waiting to be unlocked?

Most Popular Narrative: 23% Overvalued

According to the most widely followed narrative, BigBear.ai’s fair value is around $5.83, which is notably below the last close price of $7.19. This gap suggests the narrative implies a stretch in the current share price, setting the tone for a significant debate around bullish assumptions.

BigBear.ai plans to expand internationally by converting successful pilots into enduring programs and building regional partnerships with leading companies. This approach has the potential to increase revenue and global market presence. The company is focused on business alliances and strategic acquisitions, which could drive faster innovation and open new revenue streams by accessing additional markets and technologies.

Read the complete narrative.

What drives such a premium price? The answer lies in ambitious growth forecasts and bold margin targets that underpin this narrative. Want to uncover the financial leap required for these projections to pan out? See how much future outperformance is built into this fair value.

Result: Fair Value of $5.83 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, the narrative faces major risks. These include unpredictable government contract timing and the ongoing need for significant R&D investments, which could impact growth.

Find out about the key risks to this BigBear.ai Holdings narrative.

Build Your Own BigBear.ai Holdings Narrative

If you see things differently or want to dig into the numbers at your own pace, crafting your own perspective takes less than three minutes. Do it your way

A great starting point for your BigBear.ai Holdings research is our analysis highlighting 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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