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Sabre (SABR) Strengthens Partnership With Shiji Distribution

·4-min read

Sabre Corporation SABR recently announced that it has extended its partnership with Shiji Distribution Solutions, a Chinese software company serving hospitality, retail, food and entertainment services industries.

This extension will offer Sabre hospitality partners access to the lucrative Chinese travel market. Using Sabre’s SynXis hospitality platform, which powers over 40% of the world’s leading hotel brands, hoteliers will get further access to the channels used by Chinese travellers to search and book corporate and leisure trips. This, in turn, will aid the hoteliers create brand awareness in the Chinese market.

Under this agreement, Sabre hoteliers will get access to a broad range of travel agents, online travel agencies, travel management companies and wholesalers via Sabre’s Channel Connect platform across the Chinese market.

Sabre Corporation Price and Consensus

Sabre Corporation Price and Consensus
Sabre Corporation Price and Consensus

Sabre Corporation price-consensus-chart | Sabre Corporation Quote

Founded in 1998, the Shiji Group currently provides software solutions and services to more than 91,000 hotels, 600,000 retail stores and 200,000 restaurants. Previously, Sabre partnered with Shiji and connected hoteliers to selected Chinese channels like WeChat Booking Engine, Fliggy and Meituan's travel platforms.

The leading travel-related software and technology provider has customer base spread over 160 nations globally. It is one of the largest marketplaces in the world that manages approximately $260 billion worth of global travel spending annually.

This partnership extension with Shiji Distribution Solutions reflects the reliability of Sabre’s SynXis hospitality platform and Channel Connect platform. This, in turn, is likely to aid the company in expanding its customer base and boost its Hospitality Solutions segment revenues.

Recent Deal Wins

Following a severe downturn in its earnings due to the pandemic, Sabre has been showing signs of a turnaround lately with consecutive deals wins from major global airlines, hoteliers and travel agencies. Case in point, Sabre recently extended partnership with Etihad Airways to provide network planning and revenue management solutions to support its operations.

Prior to that, the company signed a strategic partnership with Biman Bangladesh, to provide Global Distribution System and SabreSonic Passenger Service System solutions. It also signed an agreement with GOL Linhas Aéreas, Brazil’s leading domestic airline, to provide full SabreSonic PSS offering.

In August, it strengthened its long-term relationship with Qatar Airways by agreeing to provide New Distribution Capability-enabled solutions.

In July, it started a long-term contract with Cleartrip for providing its GDS platform and Bargain Finder Max API technology solutions. In the same month, it expanded its SabreSonic passenger service system deal with Alaska Airlines.

Before that, the company signed a multi-year contract with the UK-based Polani Travel Group. Per the deal, Polani Travel Group will utilize Sabre’s technology platform to support growth plans and future innovations. In a separate deal, it partnered with Curator Hotel & Resort Collection to provide hospitality solutions.

With a rise in vaccination efforts and lifting of restrictions across the world, the industry is gradually recovering from the pandemic blues. Hence, Sabre is well-poised to capitalize on the travel industry's improving market scenario.

During second-quarter fiscal 2021, Sabre’s Hospitality Solutions segment revenues totaled $51 million compared with the year-ago quarter’s $29 million. This upside was primarily fueled by the continued gradual recovery in central reservation system transactions and higher Digital Experience revenues. Lately, Sabre has seen a significant rise in global hotel bookings and air bookings in the company’s largest region, North America.

Though its latest financial results reflect significant year-over-year improvement in gross bookings and reservation-system transactions, the metrics are still down by over 50% from second-quarter 2019. Sabre refrained from issuing an outlook citing uncertainty about the impact of the pandemic on its financials, which is disappointing.

Additionally, the emergence of the more contagious coronavirus variant — Delta — in several parts of the world remains a concern. Even some parts of the United States are witnessing the Delta variant outbreaks. This could affect the overall travel industry as governments across the world may impose travel restrictions again.

Zacks Rank & Key Picks

Sabre currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the broader technology sector are Avnet AVT, EPAM Systems EPAM and Paycom Software PAYC, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate of Avnet, EPAM Systems and Paycom Software are pegged at 25.4%, 26.5% and 25%, respectively.


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