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UMG

Universal Music Group ENXTAM:UMG Stock Report

Last Price

€20.09

Market Cap

€36.4b

7D

6.5%

1Y

n/a

Updated

28 Jun, 2022

Data

Company Financials +
UMG fundamental analysis
Snowflake Score
Valuation2/6
Future Growth4/6
Past Performance1/6
Financial Health2/6
Dividends2/6

UMG Stock Overview

Universal Music Group N.V. operates as a music company worldwide.

Universal Music Group Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Universal Music Group
Historical stock prices
Current Share Price€20.09
52 Week High€27.96
52 Week Low€17.58
Beta0
1 Month Change-3.72%
3 Month Change-15.93%
1 Year Changen/a
3 Year Changen/a
5 Year Changen/a
Change since IPO-19.98%

Recent News & Updates

May 16
Calculating The Intrinsic Value Of Universal Music Group N.V. (AMS:UMG)

Calculating The Intrinsic Value Of Universal Music Group N.V. (AMS:UMG)

Today we will run through one way of estimating the intrinsic value of Universal Music Group N.V. ( AMS:UMG ) by taking...

Shareholder Returns

UMGNL EntertainmentNL Market
7D6.5%2.0%4.6%
1Yn/a-26.6%-19.4%

Return vs Industry: Insufficient data to determine how UMG performed against the Dutch Entertainment industry.

Return vs Market: Insufficient data to determine how UMG performed against the Dutch Market.

Price Volatility

Is UMG's price volatile compared to industry and market?
UMG volatility
UMG Average Weekly Movement5.9%
Entertainment Industry Average Movement6.6%
Market Average Movement5.1%
10% most volatile stocks in NL Market7.9%
10% least volatile stocks in NL Market3.2%

Stable Share Price: UMG is not significantly more volatile than the rest of Dutch stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: UMG's weekly volatility (6%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
20209,360Lucian Graingehttps://www.universalmusic.com

Universal Music Group N.V. operates as a music company worldwide. It operates through Recorded Music, Music Publishing, and Merchandising & Other segments. The Recorded Music segment discovers and develops recording artists, as well as markets and promotes their music across various formats and platforms; and engages in the live events, sponsorship, film, and television operations.

Universal Music Group Fundamentals Summary

How do Universal Music Group's earnings and revenue compare to its market cap?
UMG fundamental statistics
Market Cap€36.41b
Earnings (TTM)€886.00m
Revenue (TTM)€8.50b

41.1x

P/E Ratio

4.3x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
UMG income statement (TTM)
Revenue€8.50b
Cost of Revenue€4.61b
Gross Profit€3.90b
Other Expenses€3.01b
Earnings€886.00m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.49
Gross Margin45.81%
Net Profit Margin10.42%
Debt/Equity Ratio127.8%

How did UMG perform over the long term?

See historical performance and comparison

Dividends

2.0%

Current Dividend Yield

82%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is UMG undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for UMG?

Other financial metrics that can be useful for relative valuation.

UMG key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue4.6x
Enterprise Value/EBITDA24x
PEG Ratio2.6x

Price to Earnings Ratio vs Peers

How does UMG's PE Ratio compare to its peers?

UMG PE Ratio vs Peers
The above table shows the PE ratio for UMG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average85.6x
WBD Warner Bros. Discovery
27.8x61.0%US$33.2b
SPOT Spotify Technology
245.2x65.4%US$19.1b
NFLX Netflix
15.9x17.2%US$84.0b
WMG Warner Music Group
35x18.6%US$13.0b
UMG Universal Music Group
41.1x15.6%€36.4b

Price-To-Earnings vs Peers: UMG is good value based on its Price-To-Earnings Ratio (41.1x) compared to the peer average (85.6x).


Price to Earnings Ratio vs Industry

How does UMG's PE Ratio compare vs other companies in the European Entertainment Industry?

Price-To-Earnings vs Industry: UMG is expensive based on its Price-To-Earnings Ratio (41.1x) compared to the European Entertainment industry average (15.3x)


Price to Earnings Ratio vs Fair Ratio

What is UMG's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

UMG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio41.1x
Fair PE Ration/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate UMG's Price-To-Earnings Fair Ratio for valuation analysis.


Share Price vs Fair Value

What is the Fair Price of UMG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: UMG (€20.09) is trading below our estimate of fair value (€20.47)

Significantly Below Fair Value: UMG is trading below fair value, but not by a significant amount.


Price to Earnings Growth Ratio

PEG Ratio: UMG is poor value based on its PEG Ratio (2.6x)


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Future Growth

How is Universal Music Group forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


15.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: UMG's forecast earnings growth (15.6% per year) is above the savings rate (0.09%).

Earnings vs Market: UMG's earnings (15.6% per year) are forecast to grow faster than the Dutch market (-3.9% per year).

High Growth Earnings: UMG's earnings are forecast to grow, but not significantly.

Revenue vs Market: UMG's revenue (9.1% per year) is forecast to grow faster than the Dutch market (8% per year).

High Growth Revenue: UMG's revenue (9.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: UMG's Return on Equity is forecast to be very high in 3 years time (51.4%).


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Past Performance

How has Universal Music Group performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


-35.1%

Last years earnings growth

Earnings and Revenue History

Quality Earnings: UMG has high quality earnings.

Growing Profit Margin: UMG's current net profit margins (10.4%) are lower than last year (18.4%).


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if UMG's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: UMG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: UMG had negative earnings growth (-35.1%) over the past year, making it difficult to compare to the Entertainment industry average (11.1%).


Return on Equity

High ROE: Whilst UMG's Return on Equity (43.74%) is outstanding, this metric is skewed due to their high level of debt.


Discover strong past performing companies

Financial Health

How is Universal Music Group's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: UMG's short term assets (€3.3B) do not cover its short term liabilities (€5.4B).

Long Term Liabilities: UMG's short term assets (€3.3B) do not cover its long term liabilities (€4.7B).


Debt to Equity History and Analysis

Debt Level: UMG's net debt to equity ratio (99%) is considered high.

Reducing Debt: Insufficient data to determine if UMG's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: UMG's debt is well covered by operating cash flow (43.9%).

Interest Coverage: UMG's interest payments on its debt are well covered by EBIT (44.1x coverage).


Balance Sheet


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Dividend

What is Universal Music Group current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage


1.99%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: UMG's dividend (1.99%) isn’t notable compared to the bottom 25% of dividend payers in the Dutch market (2.22%).

High Dividend: UMG's dividend (1.99%) is low compared to the top 25% of dividend payers in the Dutch market (6.3%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether UMG's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if UMG's dividend payments are increasing as they only just started paying a dividend.


Earnings Payout to Shareholders

Earnings Coverage: At its current payout ratio (81.9%), UMG's payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (67.2%), UMG's dividend payments are covered by cash flows.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

0.8yrs

Average board tenure


CEO

Lucian Grainge (61 yo)

no data

Tenure

€40,861,706

Compensation

Sir Lucian Grainge, CBE, serves as Chairman at Universal Music Group N.V. since September 2021 and also serves as its Chief Executive Officer. He served as Chief Executive Officer of Universal Music Group,...


CEO Compensation Analysis

Compensation vs Market: Lucian's total compensation ($USD43.01M) is above average for companies of similar size in the Dutch market ($USD5.11M).

Compensation vs Earnings: Lucian's compensation has been consistent with company performance over the past year.


Board Members

Experienced Board: UMG's board of directors are not considered experienced ( 0.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: UMG only recently listed within the past 12 months.


Top Shareholders

Company Information

Universal Music Group N.V.'s employee growth, exchange listings and data sources


Key Information

  • Name: Universal Music Group N.V.
  • Ticker: UMG
  • Exchange: ENXTAM
  • Founded: 2020
  • Industry: Movies and Entertainment
  • Sector: Media
  • Implied Market Cap: €36.412b
  • Shares outstanding: 1.81b
  • Website: https://www.universalmusic.com

Number of Employees


Location

  • Universal Music Group N.V.
  • S-Gravelandseweg 80
  • Hilversum
  • Noord-Holland
  • 1217 EW
  • Netherlands

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/06/28 00:00
End of Day Share Price2022/06/28 00:00
Earnings2021/12/31
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.