Sabre WACC - Weighted Average Cost of Capital
The WACC of Sabre Corp (SABR) is 11.5%.
| Range | Selected | |
| Cost of equity | 10.4% - 15.9% | 13.15% |
| Tax rate | 1.6% - 1.8% | 1.7% |
| Cost of debt | 6.9% - 15.6% | 11.25% |
| WACC | 7.5% - 15.5% | 11.5% |
| 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 | 10.4% | 15.9% |
| Tax rate | 1.6% | 1.8% |
| Debt/Equity ratio | 3.82 | 3.82 |
| Cost of debt | 6.9% | 15.6% |
| After-tax WACC | 7.5% | 15.5% |
| Selected WACC | 11.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SABR | Sabre Corp | 3.82 | 2.45 | 0.52 |
| ALYI | Alternet Systems Inc | 3.69 | 0.86 | 0.19 |
| CNDT | Conduent Inc | 1.41 | 0.91 | 0.38 |
| CSGS | CSG Systems International Inc | 0.28 | 0.58 | 0.46 |
| MARA | Marathon Digital Holdings Inc | 0.39 | 2.06 | 1.49 |
| MGI | MoneyGram International Inc | 0.73 | 0.12 | 0.07 |
| MOS.V | Mobi724 Global Solutions Inc | 2.95 | 1.12 | 0.29 |
| PRTH | Priority Technology Holdings Inc | 1.36 | 1.61 | 0.69 |
| STNE | BRL | 0.54 | 1.08 | 0.71 |
| TTEC | TTEC Holdings Inc | 3.95 | -0.26 | -0.05 |
| WNS | WNS (Holdings) Ltd | 0.12 | 0.67 | 0.6 |
| Low | High | |
| Unlevered beta | 0.38 | 0.52 |
| Relevered beta | 1.64 | 2.45 |
| Adjusted relevered beta | 1.43 | 1.97 |
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.