SABR
Sabre Corp
Price:  
3.42 
USD
Volume:  
4,463,377.00
United States | IT Services
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Sabre WACC - Weighted Average Cost of Capital

The WACC of Sabre Corp (SABR) is 11.5%.

The Cost of Equity of Sabre Corp (SABR) is 13.15%.
The Cost of Debt of Sabre Corp (SABR) is 11.25%.

Range Selected
Cost of equity 10.40% - 15.90% 13.15%
Tax rate 1.60% - 1.80% 1.70%
Cost of debt 6.90% - 15.60% 11.25%
WACC 7.5% - 15.5% 11.5%
WACC

Sabre WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.43 1.97
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.40% 15.90%
Tax rate 1.60% 1.80%
Debt/Equity ratio 3.82 3.82
Cost of debt 6.90% 15.60%
After-tax WACC 7.5% 15.5%
Selected WACC 11.5%

Sabre's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for Sabre:

cost_of_equity (13.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.43) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.