Morgan Stanley | Our analyst, Laura Metayer, believes that the Hospitality & Other solutions division is Amadeus’ fastest growing segment (AMS), which is made up of its centralised reservations product (CRS), leading a €1.8bn market, and the newer hotel management system (PMS) in a €2.2bn market.
The analyst team estimates that the hospitality IT market, with a size of €7.4bn MSe and growth of >8% CAGR, is moving towards a single platform concept in which Amadeus would be one of two vendors with existing products in both CRS and PMS. In the analyst’s base case, Amadeus positions itself as a leader and increases its market share from ~10% in 2022 to ~13-15% in 2026 and 16% in its bull case. The estimated growth of the segment takes the Price Target to €69.5 (19% upside), as Amadeus expects to benefit from this paradigm shift in the segment, which it could confirm if it announces the development of a PMS product for a large hotel chain.
Amadeus IT, Overweight, Target Price €68.5 to €69.5/share.
