Stock Advisory: Consider Selling Bigbear.ai Shares?
BigBear.ai (BBAI), an AI-driven analytics company, is set to announce its earnings on August 11, 2025. Over the past five years, the stock's performance following earnings announcements has shown a pattern of volatility, particularly when earnings significantly miss expectations.
In approximately 14% of cases over the past five years, BigBear.ai has seen positive one-day returns following earnings, with a median of 1.3%. However, the median one-day loss for BBAI after an earnings report is -14%, and the maximum one-day loss has been as high as -31.6%.
Historically, BBAI has seen a one-day decline following earnings reports in 86% of cases. This trend is evident in the Q2 2025 earnings, where a large negative surprise (-$0.71 EPS versus an estimate of -$0.06) led to a 16% drop in the stock price [2][3].
Earlier quarters also exhibited volatility. For instance, Q1 2025 and Q4 2024 saw earnings misses resulting in negative sentiment and share price declines [4]. Conversely, quarters with earnings beats, such as Q3 2023, led to positive stock reactions, though these were less frequent.
The correlation between one-day (1D) and twenty-one-day (21D) returns following earnings is not specified. Similarly, the correlation between 1D post-earnings returns and subsequent five-day (5D) returns is not available.
BigBear.ai reported a net loss of -$232 million and an operating loss of -$54 million over the past twelve months. Despite these short-term challenges, the company generated $160 million in revenue over the past year.
Analysts expect revenues for the upcoming quarter to be around $40.6 million, a 2% increase from the same quarter last year. Some analysts maintain a "Strong Buy" rating based on BigBear.ai’s long-term growth prospects in AI-driven analytics [1][3].
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In conclusion, BigBear.ai's stock price tends to decline sharply after earnings reports that miss estimates, as seen in Q2 2025 (-16% drop) [2][3]. Earnings beats or smaller misses have led to limited positive movements, but these are rare [4]. The overall trend demonstrates substantial volatility linked directly to earnings surprises. Analysts remain cautiously optimistic, maintaining buy ratings despite near-term challenges [1][3]. BigBear.ai currently has a market capitalization of $1.8 billion.
Investors may find the upcoming BigBear.ai (BBAI) earnings announcement on August 11, 2025, particularly intriguing due to the stock's historically volatile performance following earnings reports. The pattern of volatility, especially when earnings significantly miss expectations, poses a potential downside for BigBear stock. On the contrary, technology-focused companies like BigBear.ai, in the finance sector, might also see positive one-day returns, albeit infrequently, if they manage to beat earnings estimates.
