Financial Review: Brinker International (NYSE:EAT) versus Sabre (NASDAQ:SABR)

Brinker International (NYSE:EAT) and Sabre (NASDAQ:SABR) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.

Profitability

This table compares Brinker International and Sabre’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brinker International	8.39%	122.35%	17.42%
Sabre	25.14%	N/A	-2.12%

Insider and Institutional Ownership

89.4% of Sabre shares are owned by institutional investors. 1.2% of Brinker International shares are owned by insiders. Comparatively, 2.8% of Sabre shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and price targets for Brinker International and Sabre, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brinker International	0	5	17	2	2.88
Sabre	1	3	1	0	2.00

Brinker International presently has a consensus price target of $243.38, suggesting a potential upside of 28.04%. Sabre has a consensus price target of $1.75, suggesting a potential downside of 8.85%. Given Brinker International’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Brinker International is more favorable than Sabre.

Earnings & Valuation

This table compares Brinker International and Sabre”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brinker International	$5.81 billion	1.37	$487.00 million	$10.89	17.45
Sabre	$2.77 billion	0.28	$524.62 million	$1.65	1.16

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

Risk & Volatility

Brinker International has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500. Comparatively, Sabre has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500.

Summary

Brinker International beats Sabre on 11 of the 15 factors compared between the two stocks.

About Brinker International

Brinker International, Inc., together with its subsidiaries, engages in the ownership, development, operation, and franchising of casual dining restaurants in the United States and internationally. It operates and franchises Chili's Grill & Bar and Maggiano's Little Italy restaurant brands. The company also operates virtual brands, It's Just Wings. Brinker International, Inc. was founded in 1975 and is headquartered in Dallas, Texas.

About Sabre

Sabre Corporation, together with its subsidiaries, operates as software and technology company for travel industry in the United States, Europe, Asia-Pacific, and internationally. It operates through two segments: Travel Solutions and Hospitality Solutions. The Travel Solutions segment operates 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. This segment provides a portfolio of software technology products and solutions through software-as-a-service (SaaS) and hosted delivery models to airlines and other travel suppliers. Its products include reservation systems for carriers, commercial and operations products, agency solutions, and data-driven intelligence solutions. Its Hospitality Solutions segment provides software and solutions to hoteliers through SaaS and hosted delivery models. Sabre Corporation was incorporated in 2006 and is headquartered in Southlake, Texas.