Corporate insiders know more about their businesses than anyone else. If these individuals are buying company stock, it’s often worth taking a closer look.
In this report, we are going to highlight insider buying at Sabre Corp (SABR:US). Sabre is a software company that provides solutions to the travel industry. Its customers include airlines, hoteliers, agencies, and other travel-related businesses. It’s listed on the Nasdaq and currently has a market cap of $1.78 billion.
Insider Buying at Sabre
2iQ data shows that on November 22, Sabre’s CFO Michael Randolfi purchased 100,000 SABR shares at a price of $4.79 per share. This trade cost the insider around $479k and increased his holding to 209,170 shares.
This trading activity is worth highlighting for a couple of reasons.
Firstly, Mr. Randolfi is a top-level insider. As CFO, he is likely to have deep insight into his firm’s performance and financials.
Secondly, the trade has boosted the size of Mr. Randolfi’s holding by 92%. The fact that the insider has increased the size of his holding by such a large percentage suggests that he is very confident the market is mis-pricing the stock right now.
Sabre’s recent Q3 results showed that the company is recovering from the pandemic.
For the period, revenue totaled $663 million compared to $441 million a year earlier. This increase in revenue was driven by an increase in global air, hotel, and other travel bookings as well as favorable rate impacts in its Travel Solutions business.
Operating loss was $57 million versus a loss of $157 million in Q3 2021, while adjusted EBITDA was $34 million versus an adjusted EBITDA loss of $55 million a year earlier.
Looking ahead, the company said that it expects to be free cash flow positive in both Q4 and 2023, and annually thereafter. It also said that it’s on track to generate long-term cost savings from its technology transformation.
“We continue to see strong demand across most regions and customer segments," commented Sean Menke, Chair of the Board and CEO.
In light of these results, we see the insider buying here as a bullish development.