NYSE:TME

Stock Analysis Report

Tencent Music Entertainment Group

Executive Summary

Tencent Music Entertainment Group operates online music entertainment platforms that provides music streaming, online karaoke, and live streaming services in the People’s Republic of China.

Snowflake

Fundamentals

Flawless balance sheet with high growth potential.


Similar Companies

Share Price & News

How has Tencent Music Entertainment Group's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

1.4%

TME

0.2%

US Entertainment

0.5%

US Market


1 Year Return

n/a

TME

1.2%

US Entertainment

6.8%

US Market

Return vs Industry: Insufficient data to determine how TME performed against the US Entertainment industry.

Return vs Market: Insufficient data to determine how TME performed against the US Market.


Shareholder returns

TMEIndustryMarket
7 Day1.4%0.2%0.5%
30 Day-0.6%-1.3%-0.8%
90 Day-7.0%-4.6%-0.9%
1 Yearn/a2.0%1.2%9.2%6.8%
3 Yearn/a52.4%47.5%45.6%36.2%
5 Yearn/a90.3%78.4%63.2%45.4%

Price Volatility Vs. Market

How volatile is Tencent Music Entertainment Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Tencent Music Entertainment Group undervalued compared to its fair value and its price relative to the market?

41.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TME ($13.5) is trading below our estimate of fair value ($23.21)

Significantly Below Fair Value: TME is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TME is poor value based on its PE Ratio (75.9x) compared to the Entertainment industry average (40.9x).

PE vs Market: TME is poor value based on its PE Ratio (75.9x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

PEG Ratio: TME is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: TME is overvalued based on its PB Ratio (3.8x) compared to the US Entertainment industry average (2.7x).


Next Steps

Future Growth

How is Tencent Music Entertainment Group forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

37.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TME's forecast earnings growth (37.2% per year) is above the savings rate (2.7%).

Earnings vs Market: TME's earnings (37.2% per year) are forecast to grow faster than the US market (14.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: TME's revenue (25.3% per year) is forecast to grow faster than the US market (7.2% per year).

High Growth Revenue: TME's revenue (25.3% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TME's Return on Equity is forecast to be low in 3 years time (14.5%).


Next Steps

Past Performance

How has Tencent Music Entertainment Group performed over the past 5 years?

-25.2%

Last years earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

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

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

Earnings vs Industry: TME had negative earnings growth (-25.2%) over the past year, making it difficult to compare to the Entertainment industry average (21.5%).


Return on Equity

High ROE: TME's Return on Equity (4.9%) is considered low.


Return on Assets

ROA vs Industry: TME's Return on Assets is below or equal to the Entertainment industry average last year.


Return on Capital Employed

ROCE Improving: Insufficient data to calculate TME's Return on Capital Employed to determine if it has improved over the past 3 years.


Next Steps

Financial Health

How is Tencent Music Entertainment Group's financial position?


Financial Position Analysis

Short Term Liabilities: TME's short term assets (CN¥23.8B) exceeds its short term liabilities (CN¥7.2B)

Long Term Liabilities: TME's short term assets (23.8B) exceeds its long term liabilities (668.0M)


Debt to Equity History and Analysis

Debt Level: TME is debt free.

Reducing Debt: TME has not had any debt for past 5 years.

Debt Coverage: TME has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: TME has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: TME has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if TME's debt is covered by short term assets.


Next Steps

Dividend

What is Tencent Music Entertainment Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.3%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate TME's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate TME's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if TME's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if TME's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TME's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Tencent Music Entertainment Group's salary, the management and board of directors tenure and is there insider trading?

3.3yrs

Average board tenure


CEO

Cussion Pang (45yo)

0yrs

Tenure

0

Mr. Pang Cussion serves as the Chief Executive Officer of Tencent Music Entertainment Group and has been its Director since May 2014. Prior to joining us, Mr. Pang served as a corporate vice president of T ...


Board Age and Tenure

3.3yrs

Average Tenure

45yo

Average Age

Experienced Board: TME's board of directors are considered experienced (3.3 years average tenure).


Insider Trading

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


Ownership Breakdown


Management Team

  • Cussion Pang (45yo)

    CEO & Director

    • Tenure: 0yrs
  • Zhenyu Xie (44yo)

    CTO, Co-President & Director

    • Tenure: 5.5yrs
  • Min Hu (47yo)

    Chief Financial Officer

    • Tenure: 0yrs
  • Tony Yip (38yo)

    Chief Strategy Officer & Head of Ultimate Music

    • Tenure: 1.8yrs
  • Millicent T.

    Vice General Manager

    • Tenure: 0yrs

Board Members

  • Martin Lau (46yo)

    Director

    • Tenure: 3.3yrs
  • James Mitchell (45yo)

    Director

    • Tenure: 0.8yrs
  • Edith Manling Ngan (54yo)

    Independent Director

    • Tenure: 0.8yrs
  • Cussion Pang (45yo)

    CEO & Director

    • Tenure: 0yrs
  • Zhenyu Xie (44yo)

    CTO, Co-President & Director

    • Tenure: 5.5yrs
  • Brent Richard Irvin (46yo)

    Director

    • Tenure: 3.3yrs
  • Liang Tang (41yo)

    Independent Director

    • Tenure: 5.5yrs
  • Tak-Wai Wong (42yo)

    Independent Director

    • Tenure: 3.3yrs
  • Tao Sang Tong (45yo)

    Chairman of the Board

    • Tenure: 0yrs

Company Information

Tencent Music Entertainment Group's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Tencent Music Entertainment Group
  • Ticker: TME
  • Exchange: NYSE
  • Founded: 2012
  • Industry: Movies and Entertainment
  • Sector: Media
  • Market Cap: US$22.075b
  • Shares outstanding: 1.64b
  • Website: https://www.tencentmusic.com

Number of Employees


Location

  • Tencent Music Entertainment Group
  • Matsunichi Building
  • 17th Floor
  • Shenzhen
  • Guangdong Province
  • 518057
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TMENYSE (New York Stock Exchange)YesSPON ADSUSUSDDec 2018

Biography

Tencent Music Entertainment Group operates online music entertainment platforms that provides music streaming, online karaoke, and live streaming services in the People’s Republic of China. It offers QQ Mu ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/21 01:00
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.