BigBear.ai Holdings Inc

BigBear.ai Holdings, Inc. (NYSE: BBAI) is an artificial intelligence (AI)-powered decision intelligence solution. The Company operates through two segments: Cyber & Engineering and Analytics.

Recent Financial and Business Updates:

Financial Highlights:

• Revenue increased by 15.8% to USD 42.2 million in the first quarter of 2023, compared to USD 36.4 million in the first quarter of 2022.
• Gross margin in the first quarter of 2023 was 24.2%, down from 27.1% in the first quarter of 2022, primarily due to additional costs associated with the Global Force Information Management (GFIM) Phase 2 contract.
• Net loss for the first quarter of 2023 was USD 26.2 million, including non-cash expenses of USD 10.6 million related to the change in fair value of PIPE warrants issued in January 2023, USD 3.8 million of equity-based compensation expense, and USD 0.8 million for restructuring charges. This compares to a net loss of USD 18.8 million in the first quarter of 2022.
• Non-GAAP Adjusted EBITDA for the first quarter of 2023 was USD (3.8) million, compared to USD (2.9) million in the first quarter of 2022.
• Net cash used in operating activities amounted to USD 12.0 million, compared to USD 7.5 million in the first quarter of 2022, primarily due to the timing of contract awards and vendor payments.
• A universal shelf registration statement was filed in April 2023, enabling the offering of up to USD 500 million in securities, aimed at facilitating quick access to capital markets and strengthening the overall financial profile.
• The ending backlog amounted to USD 197 million.
  

New Business Developments:

• ai signed an exclusive provider agreement with L3Harris, offering computer vision, predictive analytics, and event alerting analytics applications for autonomous surface vessels and their shore based C2 maritime operations systems for the Department of Defense (DoD).
• At International Maritime Exercise 23 (IMX 23), BigBear.ai successfully demonstrated its AI/Machine Learning (ML)-powered decision support solution, providing real-time situational awareness, predictive forecasts, and computer vision capabilities using ML-augmented algorithms and analytics for Task Force 59.
• Two solutions from BigBear.ai, Observe (a massive, distributed data collection capability) and AI/ML-based forecasting and situational awareness analytics with computer vision capabilities developed for autonomous systems, have been added to the Department of Defense's Chief Digital and Artificial Intelligence Office's Tradewind Initiative. Tradewind serves as a marketplace for sourcing, funding, and developing AI/ML, digital, and data analytics solutions for various DoD use cases.
• Leadership updates include the appointment of Norm Laudermilch as Chief Operating Officer and the promotion of Greg Goldwater to Chief Growth Officer, reflecting the company's growth and expansion in key markets.
  

Technical Observation (on the daily chart)

The price of BBAI stock has shown a consistent downward trend since making 52-week high on February 09, 2023, correcting around 69.57%. Currently, the stock is near an important support zone of USD 1.80-USD 2.00, from where price has taken support in the past. The RSI (14 period) momentum indicator is around oversold zone with a value of 35.11, with expectations of some consolidation or a short-term upside momentum. Moreover, the price is currently positioned below both the 21-day SMA and 50-day SMA trend-following indicators, which may act as dynamic short-term resistance levels.

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As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Speculative Buy’ rating has been given to BigBear.ai Holdings, Inc. (NYSE: BBAI) at the closing price of USD 1.89 as of July 20, 2023.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing. 

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

How to Read the Charts?

The Green colour line reflects the 21-period simple moving average (SMA) while the red line indicates the 50- period simple moving average (SMA). SMA helps to identify existing price trends. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

The reference date for all price data, currency, technical indicators, support, and resistance levels is July 20, 2023. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by individual. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.

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