We recently compiled a list of the 10 AI Stocks Investors Are Watching Closely Right Now. In this article, we are going to take a look at where BigBear.ai Holdings, Inc. (NYSE:BBAI) stands against the other stocks.
The Trump administration is considering a ban against Chinese AI chatbot DeepSeek from U.S. government devices amid national-security concerns. According to people familiar with the matter, U.S. officials are worried about how DeepSeek handles user data, which is said to be stored in servers in China. They also expressed concerns over how DeepSeek hasn’t sufficiently explained how it uses the data it collects or who has access to it.
The Wall Street Journal was the first to report the news, stating further how administration officials are further considering banning the chatbot from app stores and placing limits on how U.S.-based cloud service providers could offer DeepSeek’s AI models to their customers. These discussions, however, are still in the early stages.
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Several governments have been banning the use of DeepSeek ever since its emergence. South Korea, for instance, suspended new app downloads after the company failed to address regulators’ concerns about its privacy policy. Taiwan’s Ministry of Digital Affairs stated that DeepSeek “endangers national information security”, banning government agencies from using the company’s AI. Italy has also banned DeepSeek after an investigation by the country’s privacy watchdog into how DeepSeek handles personal data.
Within the US, certain agencies have independently acted as well. For instance, the US Navy has warned its members to avoid using DeepSeek “in any capacity” due to “potential security and ethical concerns.” The email specifically asked recipients to “refrain from downloading, installing, or using the DeepSeek model in any capacity.”
Banning DeepSeek entirely for the general public, however, is complicated considering the AI models are open-source. This means that anyone can download and use them for free. Many US cloud vendors have been providing DeepSeek’s models as part of their services, and restricting access can anger investors and businesses who support the technology.
“U.S. officials considering technology controls are dealing with new territory here on what to do with open-sourced models.”
Paul Triolo, a partner at DGA-Albright Stonebridge in Washington, D.C.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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BigBear.ai Holdings, Inc. (NYSE:BBAI)
Number of Hedge Fund Holders: 13
BigBear.ai Holdings, Inc. (NYSE:BBAI) is an artificial intelligence specialist that provides decision intelligence solutions. On March 7, Northland analyst Michael Latimore downgraded the stock to “Market Perform” from Outperform with a price target of $4, up from $2.50. The firm will keep the shares downgraded until the new CEO’s plans are implemented and BigBear.ai Holdings, Inc. (NYSE:BBAI) returns to meaningful and consistent growth.
The analyst told investors in a research note how the company has reported a large revenue and slight EBITDA miss in Q4, and that government spending patterns remain uncertain in the short term. The stock of the artificial intelligence company has slipped more than 20% after the company warned that it could see a disruption of federal contracts.
Overall BBAI ranks 10th on our list of AI stocks investors are watching closely right now. While we acknowledge the potential of BBAI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BBAI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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