H.C. Wainwright Sees Long-Term Upside for BigBear.ai (BBAI) Despite Setbacks

BigBear.ai Holdings, Inc. (NYSE:BBAI) ) is one of the AI Stocks Investors Are Watching Closely. On August 12, H.C. Wainwright analyst Scott Buck lowered the price target on the stock to $8.00 (from $9.00) while maintaining a Buy rating. The price target cut follows BigBear.ai’s second quarter results which it posted after the markets closed on August 11^th.

The firm discussed how the artificial intelligence company’s revenue of $32.5 million was significantly below its $41 million estimate. BigBear.ai also lowered its full-year revenue guidance to $125.0M to $140.0M, down from $160.0M and $180.0M. The firm considers this low guidance to be because of lower 2Q25 revenue coupled with disruptions in federal contracts, particularly in programs supporting the U.S. Army.

The firm acknowledged that these results are disappointing, but also pointed out that they shouldn’t come as a surprise.

“While disappointing, these results should not come as a surprise given what we have heard from other reporting peers in the defense space, which have also experienced program delays. We believe revenue visibility could begin to improve as the business moves towards 2026.”

Longer term, the firm considers BigBear.ai to be a beneficiary of the One Big Beautiful Bill.

“Longer term, we believe BigBear.ai is well positioned to be a beneficiary of the One Big Beautiful Bill, which substantially increases investment in areas aligned with the company’s core competencies. This includes $170.0B of incremental funding to the Department of Homeland Security. In addition, the company solidified its balance sheet during 2Q25, ending the quarter with more than $390.0M of available cash. We expect this capital to be deployed in coming quarters, through reinvestment in the business as well as complementary M&A. While we expect shares to respond negatively to 2Q25 results and change in guidance, we see an improved balance sheet and favorable industry and legislative trends as catalysts for long term growth. As a result, we suspect operating results and outlook should look materially stronger a year from now. We recommend investors take advantage of any near term weakness in BBAI shares to accumulate a position ahead of more favorable operating results. We remain Buy-rated but ave lowered our price target to $8 from $9, reflecting our lower 2026 revenue forecast.”

BigBear.ai Holdings, Inc. (NYSE:BBAI) is an artificial intelligence specialist that provides decision intelligence solutions for national security, digital identity, supply chain and logistics, enterprise operations, and manned-unmanned teaming in autonomous systems.

While we acknowledge the potential of BBAI as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 10 AI Stocks Investors Are Watching Closely and 10 AI Stocks Analysts Are Watching Closely.

Disclosure: None.