Why BigBear.ai Stock Is Ripping Higher Today

Key Points

• BigBear.ai announced that it will participate in the U.S. Navy's maritime exercises.

• Investors are turning to BigBear.ai as a viable opportunity despite the rampant interest in Palantir Technologies.

• Those looking to reduce their risk may be more interested in a defense ETF.

• 10 stocks we like better than BigBear.ai ›

Poised to post its 10th consecutive day of closing higher than the day before, BigBear.ai (NYSE: BBAI) stock roared out of the gate this morning. Investors with an eye for artificial intelligence (AI) stocks recognized the company's announcement of its participation in a U.S. Navy demonstration as an encouraging development, leading them to enthusiastically click the buy button on BigBear.ai stock.

As of 12:21 p.m. ET, shares of BigBear.ai are up 15.8%.

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Image source: Getty Images.

Helping to make the seas a little safer

Supporting the U.S. Navy's participation in UNITAS, maritime exercises that include the participation of more than two dozen allies, BigBear.ai will deploy AI solutions that the company claims "can improve coordination, decision-making, and threat detection in vast maritime operation zones where counter-narcotics, human trafficking, and arms smuggling are key concerns."

BigBear.ai also announced that it will demonstrate ConductorOS, a platform that integrates AI, data, and sensor orchestration, which can operate in a variety of challenging environments and help users to deploy, train, and update AI models across various missions.

For investors, the Navy's selection of BigBear.ai's solutions is an auspicious sign that the company is still worthy of the military's interest. With Palantir Technologies commanding so much attention from the market, investors are recognizing that it's hardly a zero-sum game, and BigBear.ai can also prosper from the defense industry's embracing of AI solutions.

Is BigBear.ai stock a buy now?

While today's news from BigBear.ai is encouraging, it's important to recognize that it's not really moving the needle for the company. Those unenthusiastic about BigBear.ai stock yesterday won't see today's announcement as reason to change their minds, but it's certainly worth acknowledging the development, and it does speak to the fact that Palantir stock isn't the only opportunity for investors to benefit from the military's interest in fortifying their capabilities with AI solutions.

With both BigBear.ai and Palantir stock soaring recently, cautious investors looking for AI stocks specializing in defense solutions may want to consider a defense ETF as a way to mitigate the risk of an individual stock experiencing a sell-off.

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Scott Levine has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.