BigBear.ai Price Target Cut to $5 as Q4 Revenue Drops 37.7%
BigBear.ai's price target was cut to $5 from $6 after fourth-quarter revenue fell to $27.3 million, down 37.7% year-over-year, and EPS loss narrowed to $0.01, beating estimates. Fiscal 2026 revenue is guided at $135–165 million, implying 17% growth at the midpoint, including $25 million from the Ask Sage acquisition.
1. Price Target Reductions
Cantor Fitzgerald lowered its price target on BigBear.ai to $5 from $6 while maintaining a Neutral rating following the fourth-quarter results. H.C. Wainwright also cut its target to $6 from $8 but kept a Buy rating, citing improvements in the company’s balance sheet that enhance funding flexibility for growth.
2. Fourth-Quarter Financial Results
BigBear.ai reported Q4 revenue of $27.3 million, a 37.7% year-over-year decline driven by disruptions in U.S. Army contracts and federal program headwinds. The company posted an EPS loss of $0.01, outperforming the consensus of a $0.06 loss, and recorded adjusted EBITDA of negative $10.3 million due to lower margins and higher operating expenses.
3. Fiscal 2026 Guidance and Strategic Initiatives
Management projects fiscal 2026 revenue between $135 million and $165 million, implying approximately 17% growth at the midpoint, with an estimated $25 million contribution from the Ask Sage acquisition. The company has reduced debt by over 90%, completed two strategic acquisitions, and raised about $693 million, positioning itself to capitalize on the U.S. government’s AI Acceleration Strategy for future demand.