SABR stock

 Sabre (NYSE:SABR) operates a global distribution system. These are the platforms that airlines, passenger railroads, cruise operators, hotels, and other travel companies use to distribute tickets and reservations to travel agencies and other customers.

GDS operators serve as a marketplace; the airlines and other providers list all of their available itineraries and then travel agencies, online booking sites, and so on can sort through the GDS inventory and purchase through that platform. The GDS operator collects a fee for the purchase.

For obvious reasons, the GDS operators including Sabre saw their profits collapse during the pandemic. Sabre was caught in a particular bind, since it had invested heavily to modernize its previously outdated IT system.

Unfortunately, the debt related to that expense piled up and the firm hasn’t been able to recoup on that investment quickly enough thanks to the travel stoppage. This explains why Sabre remains at a depressed valuation despite the ensuing travel recovery.

However, the company expects major cost savings in 2024 and 2025 and has a path to positive earnings. Sabre is in a race against the clock to reach profitability and deal with its interest expenses and flimsy balance sheet. But if the firm can successfully roll over its nearer-term obligations, the stock could be a multi-bagger from current levels.

Sabre stock has tremendous torque for higher international travel and tourism volumes making it a great pick for travel stock bulls. SABR stock is the riskiest on this list, but if general economic conditions permit, the stock could have tremendous upside from current levels.