Update shared on 27 Nov 2025
Analysts have raised their average price target for Warner Music Group to $38.00 from $35.00. They cite improving profit margins, accelerating streaming growth, and expectations for higher music pricing as factors that could drive future value.
Analyst Commentary
Analyst sentiment toward Warner Music Group remains strongly positive, with several making upward adjustments to their valuation targets and highlighting the company’s ongoing strategic strength.
Bullish Takeaways- Bullish analysts note that Warner Music is benefiting substantially from accelerating streaming subscription growth. This is expected to drive higher revenues and support robust long-term expansion.
- The recent trend of raising price targets among analysts reflects growing confidence in Warner Music’s ability to expand profit margins through both cost reductions and improved operational efficiency.
- There is optimism about the industry’s shift from a primary focus on volume growth to capitalizing on newfound pricing opportunities. This could enhance overall value creation for shareholders.
- Analysts anticipate that record labels, including Warner Music, are well-positioned to realize upside from increases in wholesale music pricing. This reinforces their attractiveness in the sector.
What's in the News
- Warner Music Group settled its copyright lawsuit with AI startup Udio and entered into a licensing agreement that will enable Udio to launch a new music creation subscription service in 2026. Artist participation will be required for their music to be included (Financial Times).
- Both Warner Music Group and Universal Music are nearing AI licensing deals with several startups, including ElevenLabs, Stability AI, Suno, Udio, and Klay Vision. These partnerships may be finalized in the near future (Financial Times).
- Warner Music and Suno have announced a first-of-its-kind partnership to develop advanced, artist-friendly AI music creation tools. The collaboration is expected to provide new revenue opportunities and stronger protections for artists and songwriters.
- Warner Music and Stability AI are collaborating on responsible AI tools for music creation, with the goal of facilitating new creative opportunities while safeguarding creators' rights.
- Suno has acquired Songkick from Warner Music Group and plans to combine interactive music features and live performance discovery to strengthen artist-fan connections.
Valuation Changes
- Consensus Analyst Price Target remains unchanged at $38.00 per share, reflecting a stable outlook on fair value.
- Discount Rate has risen slightly from 9.76% to 9.97%, indicating a modest increase in perceived risk or capital costs.
- Revenue Growth has improved from 5.08% to 5.30%, suggesting higher anticipated top-line expansion.
- Net Profit Margin has increased from 11.76% to 12.50%, highlighting stronger profitability expectations.
- Future P/E has fallen from 30.24x to 27.27x, which may indicate a potential reduction in growth premium or higher projected earnings.
Disclaimer
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