Why BigBear.ai Stock Is Skyrocketing Today

BigBear.ai (NYSE: BBAI) stock is seeing another day of explosive gains in Monday's trading. The software specialist company's share price was up 20% as of 2:15 p.m. ET. Meanwhile, the S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) were both up 1% during that time frame.

BigBear's valuation is surging higher today thanks to excitement surrounding defense technology stocks. The company's share price is now up 83% over the last month.

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BigBear.ai stock surges on continued defense tech rally

BigBear.ai stock is continuing to rally in conjunction with rising excitement surrounding technology companies with substantial exposure to the defense industry. The last major business-specific news for the company arrived on June 17, when BigBear.ai announced that multiple biometric identification systems from its Pangiam unit had been deployed in major international airports. Given that this announcement corresponded with relatively little movement for the stock, BigBear.ai's recent gains appear to be mostly driven by the broader increase in bullish momentum for defense-tech plays.

What's next for BigBear.ai?

BigBear.ai stock has been highly volatile over the last year. While the company certainly has some substantial opportunities to score wins as defense-tech spending continues to rise, its business performance has also been somewhat uneven. For example, the company's revenue grew just 5% year over year in the first quarter despite the strong demand backdrop for artificial intelligence (AI) software. Additionally, it appears that some of the company's recent gains have been driven by meme-stock momentum.

Based on publicly available knowledge, BigBear.ai's recent gains seem somewhat out of step with its recent valuation run-up. While it's possible that there are some big things in the works behind the scenes that are helping to push its valuation higher, huge gains for the stock on relatively little news also mean that the risk profile here has gone up substantially again.

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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.