Cantor maintains neutral Sabre stock with $4 target

On Friday, Cantor Fitzgerald analyst Brent Knoblauch maintained a Neutral rating on Sabre Corporation (NASDAQ:SABR) with a consistent price target of $4.00. According to InvestingPro data, the stock has surged nearly 17% in the past week and is currently trading near its 52-week high of $4.30, with analyst targets ranging from $3.00 to $7.00. Sabre, a technology provider to the global travel industry, reported fourth-quarter results that matched the company’s previous guidance, with its Travel Solutions segment experiencing a 4% year-over-year growth, slightly up from 3% in the third quarter. The company’s overall revenue growth stands at 4.19% over the last twelve months, with an impressive gross profit margin of 58.58%. This increase was attributed to a steady growth in Distribution revenue.

The company’s Hospitality Solutions also saw an 8% year-over-year rise in the same quarter, compared to 7% in the previous quarter, bolstered by an uptick in Central Reservation System (CRS) transactions. Despite these positive trends, Sabre’s first-quarter guidance for revenue and EBITDA fell short of analysts’ expectations due to the timing and implementation of new commercial agreements.

Looking further ahead, Sabre’s fiscal year 2025 expectations suggest an acceleration in top-line trends and an improvement in profitability throughout the year. The growth in 2025 is expected to be driven primarily by new distribution partners in both air travel and hospitality sectors. While analysts forecast continued losses in 2025, the completion of the company’s technology transformation in 2024 is projected to yield incremental cost savings over the course of the year. For deeper insights into Sabre’s financial health and growth prospects, including 8 additional ProTips and comprehensive valuation metrics, visit InvestingPro.

Knoblauch also noted that Sabre is making steady progress with its product initiatives and continues to expand its market share within the Global Distribution System (GDS) industry. Despite these advancements, the analyst’s stance remains unchanged as the company navigates its commercial wins and cost-saving initiatives.

In other recent news, Sabre Corporation reported its fourth-quarter earnings, which surpassed analyst expectations, with an adjusted earnings per share of -$0.08, beating the anticipated -$0.10. However, the company’s revenue for the quarter was $714.72 million, slightly missing the consensus estimate of $719.14 million. Despite this revenue shortfall, Sabre’s full-year revenue for 2024 rose to $3.03 billion, marking a 4% increase year-over-year. The company also reported an adjusted EBITDA of $517 million for 2024, a significant rise from $337 million in the previous year. Looking ahead, Sabre has provided an optimistic outlook for 2025, expecting high single-digit revenue growth and adjusted EBITDA to exceed $700 million, with free cash flow projected to surpass $200 million.

In related developments, Mizuho (NYSE:MFG) Securities raised its price target for Sabre shares to $4.00 from $3.50, maintaining a Neutral rating. This adjustment follows Sabre’s performance meeting expectations and the company’s anticipated growth in fiscal year 2025, driven by market share gains and upgraded technology offerings. Mizuho’s analysts noted the potential for Sabre’s upgraded cloud-native open-source offerings to contribute significantly to growth in the travel technology sector. Despite the positive growth outlook, Mizuho’s stance remains cautiously optimistic, as reflected in the sustained Neutral rating. Sabre’s management has kept its fiscal year 2025 EBITDA guidance at over $700 million, even with temporarily elevated expenses.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.