BigBear.ai (NYSE:BBAI) Stock Price Down 7.5% - Time to Sell?

BigBear.ai Holdings, Inc. (NYSE:BBAI) experienced a significant decline, with its stock price falling by 7.5% on Wednesday. The shares dropped to a low of $4.21 before closing at $4.45. During mid-day trading, the company saw a surge in trading volume, with 66,165,219 shares exchanged, a remarkable increase of 480% compared to the average daily volume of 11,412,893 shares. The previous day’s closing price was $4.81.

Analysts Set New Price Targets

Numerous brokerage firms have recently released their assessments of BBAI. HC Wainwright raised its price target for BigBear.ai from $3.00 to $7.00 and assigned a "buy" rating to the stock in their Monday research note. In contrast, Cantor Fitzgerald maintained an "overweight" rating while setting a target price of $3.50 for BigBear.ai shares in a report dated November 6th.

BigBear.ai Stock Down 7.5%

The company possesses a quick ratio of 2.06 and a current ratio of 2.06, indicating a relatively strong liquidity position. However, it also has a debt-to-equity ratio of 2.08, which requires careful consideration from investors. The stock has a 50-day simple moving average of $2.50 and a 200-day simple moving average of $1.84. With a market capitalization of $1.12 billion, the firm shows a negative P/E ratio of -4.89 along with a beta of 3.58, suggesting higher volatility compared to the market.

Recently, BigBear.ai reported its quarterly earnings on November 5th, revealing an earnings per share (EPS) of ($0.05), which outperformed the consensus estimate of ($0.07) by $0.02. The company generated revenue of $41.51 million for the quarter, though this fell short of the consensus estimate of $45.04 million. Notably, BigBear.ai experienced a negative net margin of 109.90% and a negative return on equity of 138.35%. Despite this, the revenue for this quarter was up by 22.1% compared to the same period last year, where the company had reported an EPS of $0.03. Analysts forecast an EPS of -0.28 for the current fiscal year.

Insider Activity at BigBear.ai

In insider news, CEO Amanda Long sold 200,000 shares of the company's stock on December 26th at an average price of $4.25, totaling $850,000. Following this sale, she retains 2,583,254 shares valued at approximately $10,978,829.50, indicating a 7.19% decline in her ownership stake. This transaction was documented in a legal filing with the SEC. Additionally, on October 15th, Director Bbai Ultimate Holdings, LLC sold 572,817 shares at an average price of $1.78, amounting to $1,019,614.26. Post-sale, this director owns 143,713,297 shares valued at $255,809,668.66, reflecting a 0.40% decrease in their holdings. Over the last 90 days, insiders sold a total of 782,892 shares, valued at $1,887,246. Notably, corporate insiders hold about 1.40% of the total shares issued by the company.

Institutional Trading of BigBear.ai

Recently, several hedge funds have made moves regarding BigBear.ai shares. Sovereign Financial Group Inc. entered a new position during the third quarter, purchasing shares worth $36,000. Meanwhile, XTX Topco Ltd acquired a stake worth approximately $58,000 during the second quarter. In the third quarter, Intech Investment Management LLC made a new investment valued at $61,000. Additionally, The Manufacturers Life Insurance Company ramped up its stake by 135.0% in the second quarter, now owning 41,073 shares worth $62,000 after buying 23,597 additional shares. Lastly, Koshinski Asset Management Inc. made a new purchase worth $131,000 in the third quarter. Overall, institutional investors hold around 7.55% of the company’s stock.

BigBear.ai Company Profile

BigBear.ai Holdings, Inc. specializes in artificial intelligence-powered decision intelligence solutions, focusing on sectors like national security, supply chain management, and digital identity and biometrics. Their services include data ingestion, data enrichment, data processing, artificial intelligence, machine learning, predictive analytics, and predictive visualization.

Final Thoughts

Analysts currently rate BigBear.ai as a "Buy," but their recommendations suggest that there may be better investment opportunities in the market. It's vital for potential investors to weigh their options and stay informed about market movements and insider actions before making investment decisions.

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