Sabre (SABR, Financial) has forged a significant multi-year alliance with Gray Dawes Group, a prominent independent travel management firm. This collaboration positions Sabre as the exclusive global distribution system partner for Gray Dawes, marking a strategic step forward in their growth journey.
Utilizing cutting-edge advancements in artificial intelligence and automation, the partnership is set to enhance the efficiency of Gray Dawes' operations. These technological advancements will allow the company's agents to concentrate on more valuable customer interactions. Additionally, Sabre's approach to integrating diverse content sources aids in simplifying technology management for Gray Dawes, boosting overall operational effectiveness.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 5 analysts, the average target price for Sabre Corp (SABR, Financial) is $4.75 with a high estimate of $7.25 and a low estimate of $3.50. The average target implies an upside of 97.92% from the current price of $2.40. More detailed estimate data can be found on the Sabre Corp (SABR) Forecast page.
Based on the consensus recommendation from 6 brokerage firms, Sabre Corp's (SABR, Financial) average brokerage recommendation is currently 2.5, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Sabre Corp (SABR, Financial) in one year is $4.25, suggesting a upside of 77.08% from the current price of $2.4. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Sabre Corp (SABR) Summary page.
SABR Key Business Developments
Release Date: February 20, 2025
- Adjusted EBITDA: Increased 53% year-on-year to $517 million, surpassing initial guidance of over $500 million.
- Revenue: Total revenue for 2024 was $3,030 million, up 4% year-on-year.
- Fourth Quarter Revenue: Increased 4% year-on-year to $715 million.
- Distribution Revenue: Fourth quarter distribution revenue was $500 million, a 5% increase from Q4 2023.
- Hospitality Solutions Revenue: Q4 2024 revenue increased 8% to $81 million, driven by an 8% increase in CRS transactions.
- Free Cash Flow: Negative $14 million for 2024, including $19 million in debt modification costs.
- Cash Balance: Ended 2024 with a cash balance of $746 million.
- Adjusted EBITDA Margin: Increased from 14% in Q4 2023 to 16% in Q4 2024.
- Air Distribution Bookings: Total distribution bookings were 81 million in Q4 2024, a 4% increase from Q4 2023.
- Average Booking Fee: $6.17 in Q4 2024, up 1% year-on-year.
- 2025 Guidance: High single-digit revenue growth, adjusted EBITDA of over $700 million, and free cash flow of over $200 million.
- Capital Expenditures: Expected to be approximately $85 million in 2025.
- Cash Interest Expense: Projected to be about $375 million in 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Sabre Corp (SABR, Financial) achieved a 53% year-on-year increase in adjusted EBITDA, totaling $517 million, surpassing their initial guidance.
- The company successfully completed its technology transformation objectives, migrating over 99% of compute capacity to the cloud, resulting in over $150 million in cost benefits.
- Sabre Corp (SABR) reported double-digit growth in hotel distribution bookings and new air distribution business, contributing to solid financial results.
- The Hospitality Solutions team delivered strong results with total revenue reaching an all-time high, driven by increased CRS transactions and new customer deployments.
- The company expects double-digit growth in air distribution bookings, hotel distribution bookings, and hospitality solutions CRS transactions in 2025, driven by new commercial wins and strategic initiatives.
Negative Points
- Free cash flow for 2024 was negative $14 million, impacted by $19 million in debt modification costs.
- The average booking fee is expected to be slightly lower in 2025 due to geographic mix and growth in NDC and LCC volumes.
- Sabre Corp (SABR) anticipates a slight year-over-year increase in SG&A expenses for 2025.
- The company expects air IT revenue to be down slightly year-over-year in the first half of 2025 due to the completion of revenue from previously demigrated carriers.
- Gross margins are expected to be slightly lower in 2025 due to the mix of new business, including lower-margin NDC and LCC content.