Financial Survey: Sabre (SABR) vs. Model N (MODN)

Sabre (NASDAQ:SABR) and Model N (NYSE:MODN) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, earnings, dividends, valuation, risk and institutional ownership.

Risk & Volatility

Sabre has a beta of 0.82, meaning that its share price is 18% less volatile than the S&P 500. Comparatively, Model N has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Earnings and Valuation

This table compares Sabre and Model N’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sabre $3.87 billion 1.51 $337.53 million $1.42 14.97
Model N $154.63 million 3.56 -$28.20 million ($0.73) -23.88

Sabre has higher revenue and earnings than Model N. Model N is trading at a lower price-to-earnings ratio than Sabre, indicating that it is currently the more affordable of the two stocks.

Dividends

Sabre pays an annual dividend of $0.56 per share and has a dividend yield of 2.6%. Model N does not pay a dividend. Sabre pays out 39.4% of its earnings in the form of a dividend.

Profitability

This table compares Sabre and Model N’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sabre 8.73% 43.59% 6.83%
Model N -18.37% -51.86% -13.18%

Analyst Recommendations

This is a breakdown of current recommendations for Sabre and Model N, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sabre 1 4 3 0 2.25
Model N 0 2 6 0 2.75

Sabre currently has a consensus target price of $27.00, indicating a potential upside of 27.00%. Model N has a consensus target price of $22.71, indicating a potential upside of 30.32%. Given Model N’s stronger consensus rating and higher possible upside, analysts plainly believe Model N is more favorable than Sabre.

Insider & Institutional Ownership

91.9% of Sabre shares are owned by institutional investors. Comparatively, 72.8% of Model N shares are owned by institutional investors. 0.7% of Sabre shares are owned by company insiders. Comparatively, 1.2% of Model N shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Sabre beats Model N on 10 of the 16 factors compared between the two stocks.

About Sabre

Sabre Corporation, through its subsidiary, Sabre Holdings Corporation, provides technology solutions to the travel and tourism industry worldwide. It operates through two segments, Travel Network, and Airline and Hospitality Solutions. The Travel Network segment operates as a business-to-business travel marketplace that offers travel content, such as inventory, prices, and availability from a range of travel suppliers, including airlines, hotels, car rental brands, rail carriers, cruise lines, and tour operators with a network of travel buyers comprising online and offline travel agencies, travel management companies, and corporate travel departments. The Airline and Hospitality Solutions segment provides a portfolio of software technology products and solutions through software-as-a-service and hosted delivery models to airlines, hoteliers, and other travel suppliers. Its products include SabreSonic Customer Sales & Service, a reservation system that provides capabilities around managing sales and customer service across an airline's diverse touch points; Sabre AirVision Marketing & Planning, a set of airline commercial planning solutions; and Sabre AirCentre Enterprise Operations, a set of solutions for planning and management of airline, airport, and customer operations. This segment also provides software and solutions to hoteliers through SynXis, a central reservation system; SynXis Property Manager Solution for property management; and marketing, professional, and revenue management services. Sabre Corporation was founded in 2006 and is headquartered in Southlake, Texas.

About Model N

Model N, Inc. provides revenue management cloud solutions for the life sciences and technology companies. The company's cloud-based revenue management solutions include Revenue Cloud for Pharma, Revenue Cloud for Med Tech, and Revenue Cloud for Semiconductors and High Tech Manufacturing. It develops software applications, such as managed care and government pricing for life science companies; and channel incentives for technology companies. The company also offers revenue management processes, such as pricing, contracting, rebates, incentives, channel management, and regulatory compliance. In addition, Model N, Inc. provides implementation, managed, strategic, and customer support services. It primarily serves large and mid-sized organizations worldwide through its direct sales force. Model N, Inc. was founded in 1999 and is headquartered in San Mateo, California, with additional offices in the United States, India, and Switzerland.

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