Is BigBear.ai Your Ticket to Becoming a Millionaire?
Key Takeaways
Ai (BBAI 13. 68%) is a artificial intelligence (AI) stock pick due to its pure-play in the space. There aren't many investments that are solely focused on AI, which attracts...
Article Overview
Quick insights and key information
4 min read
Estimated completion
investment
Article classification
July 2, 2025
06:30 AM
The Motley Fool
Original publisher
Ai (BBAI 13. 68%) is a artificial intelligence (AI) stock pick due to its pure-play in the space
There aren't many investments that are solely focused on AI, which attracts investors to these ideas
Ai is also a small company, with a market cap of around $1
It wouldn't take much growth to turn this into a much larger, but is it enough to make you a millionaire from a modest investment
Image source: Getty Images
Ai has significant customer concentration For BigBear
Ai to make you a millionaire, let's say it needs to der 100 times the returns
This would transform $10,000 into $1 million if it achieves that growth level
Ai focuses on viding AI solutions, primarily to government entities
Although it doesn't name its clients, BigBear
Ai generates a significant portion of its revenue from a handful of clients, ly different government departments
In 2024, 52% of revenue came from just four customers
That's inherently an issue, as one of those customers could cut its spending with BigBear
Ai and cause significant turmoil within the
However, many companies thrived with only having a few clients as customers, so this is just a risk, not a disqualifier
Ai seems to be doing quite well with some of its clients
Last year, it was awarded a five-year, $165 million contract to develop the U
Army's Global Force Information Management-Objective Environment
This is a significant development, as it generates an average of $33 million in revenue per year for BigBear
Considering that its total revenue over the past 12 months was only $160 million, this contract is a huge boost for BigBear
BBAI Revenue (TTM) data by YCharts However, it needs to continue capturing large contracts in order to succeed
With President Donald Trump's crackdown on some levels of government spending, this could ve difficult in the near future
Ai faces an uphill battle
Still, if it can capture a few contracts here and there, it has massive upside potential, but it needs to show some life in the near future
Ai's growth needs to accelerate to be on most investors' radar screens In Q1, BigBear
Ai's revenue only rose 5% year over year to $34
Considering the significance of AI, this seems an incredibly slow growth rate
However, its backlog grew 30% year over year to $385 million, indicating strength in capturing new contracts
Ai needs to start recognizing some revenue from these contracts, as 5% growth won't suffice, especially when other competitors are dering significantly higher levels
Another highly recognized AI company that has significant exposure to the U
Government is Palantir nologies
Palantir saw 45% revenue growth to $373 million in Q1 for its U
Government-related, so it's that Palantir is both larger and faster-growing than BigBear
Ai in the government realm
Ai were dering the same growth rate as Palantir with government clients, I'd be far more excited the stock
But because it's only growing by 5%, I'm extremely skeptical
One saving grace of BigBear
Ai's stock is its relatively cheap price
BBAI PS Ratio data by YCharts At around 11 times sales, BigBear
Ai trades at the low end of the typical 10 to 20 times sales range that software companies are usually valued at
However, most software companies aren't growing at 5% year over year, which is why BigBear
Ai's valuation appears to be deceptively low
With the current state, I don't think BigBear
Ai is a millionaire-maker stock
If it starts landing big contracts and growing at a rapid pace, I may change my stance
But as of right now, there are far too many better AI stock picks out there than BigBear
Keithen Drury has no position in any of the stocks mentioned
The Motley Fool has positions in and recommends Palantir nologies
The Motley Fool has a disclosure policy.
Related Articles
More insights from FinancialBooklet