Critical Analysis: Dada Nexus (NASDAQ:DADA) & Sabre (NASDAQ:SABR)

Sabre (NASDAQ:SABR) and Dada Nexus (NASDAQ:DADA) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, valuation, institutional ownership, analyst recommendations, earnings, risk and dividends.

Insider & Institutional Ownership

89.4% of Sabre shares are owned by institutional investors. Comparatively, 59.3% of Dada Nexus shares are owned by institutional investors. 1.8% of Sabre shares are owned by insiders. Comparatively, 8.5% of Dada Nexus shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Sabre and Dada Nexus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sabre	-10.01%	N/A	-2.98%
Dada Nexus	-20.95%	-12.70%	-9.56%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Sabre and Dada Nexus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sabre	1	3	0	0	1.75
Dada Nexus	0	5	1	0	2.17

Sabre currently has a consensus price target of $3.25, indicating a potential downside of 6.61%. Dada Nexus has a consensus price target of $2.70, indicating a potential upside of 48.35%. Given Dada Nexus’ stronger consensus rating and higher probable upside, analysts clearly believe Dada Nexus is more favorable than Sabre.

Earnings & Valuation

This table compares Sabre and Dada Nexus”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sabre	$2.91 billion	0.46	-$527.61 million	($0.79)	-4.41
Dada Nexus	$1.49 billion	0.32	-$275.71 million	($1.11)	-1.64

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

Volatility & Risk

Sabre has a beta of 1.79, indicating that its share price is 79% more volatile than the S&P 500. Comparatively, Dada Nexus has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500.

Summary

Sabre beats Dada Nexus on 8 of the 14 factors compared between the two stocks.

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.

About Dada Nexus

Dada Nexus Limited operates a platform of local on-demand retail and delivery in the People’s Republic of China. It operates Dada Now, a local on-demand delivery platform that provides intra-city delivery and last-mile delivery services on an on-demand basis to chain merchants, small- and medium-sized enterprise merchants, and individual senders; and JDDJ, a local on-demand retail platforms for consumers, retailers, and brand owners. The company was incorporated in 2014 and is headquartered in Shanghai, China.