Sabre Corporation (SABR - Free Report) has received a multi-year contract from Golden Travel and Tourism for offering its innovative technology and platform. However, the companies haven’t disclosed the financial terms of the deal yet.
Per the terms of the agreement, one of the leading travel agencies in Saudi Arabia will now use Sabre’s intelligent platform — Sabre Red 360. The platform will enable Golden Travel and Tourism to harness more content and data, thereby boosting the flexibility to differentiate its offerings. Moreover, Sabre Red 360 platform will help the company efficiently manage operations and workflow, and grow faster in the region.
Deal Brings Respite Amid Coronavirus Crisis
The latest business contract from Global Travel and Tourism has brought some respite for Sabre which is witnessing negative impact of the travel restrictions imposed due to the COVID-19 pandemic-led restrictions.
The company’s second-quarter revenues tanked 92% year over year to $83 million. Moreover, the top-line figure missed the Zacks Consensus Estimate of $178 million. Revenues were primarily affected by significant reductions in air, hotel and other travel bookings due to the pandemic’s adverse impact on the global travel industry.
The company reported an adjusted loss per share of $1.30, way wider than the Zacks Consensus Estimate of loss of 78 cents. The bottom-line figure also compared unfavorably with the year-ago quarter’s earnings of 24 cents per share.
Global Travel and Tourism’s latest deal reflects that global tour and travel agencies are preparing for the post-coronavirus era. Furthermore, countries across the world have started reopening their economies which would steadily boost travel demand in the near future, which is encouraging for Sabre.
Sabre Cutting Costs to Stay Afloat
Sabre is focusing on cutting costs and is enhancing liquidity in an effort to stay afloat amid the ongoing financial and economic crisis due to the pandemic. The company has cut 25% salary of its US-based employees and has temporarily suspended the 401(K) program.
The company has also freeze its quarterly dividend and share-repurchase program to shore up balance sheet as it braces for a period of revenue slump amid the virus mayhem.
Zacks Rank & Stocks to Consider
Currently, Sabre carries a Zacks Rank #5 (Strong Sell).
A few better-ranked stocks in the broader technology sector are salesforce.com inc. (CRM - Free Report) , Blackbaud, Inc. (BLKB - Free Report) and Synaptics Incorporated (SYNA - Free Report) , each flaunting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term earnings growth rate for Salesforce, Blackbaud and Synaptics is currently pegged at 18%, 10% and 7.6%, respectively.
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