TENCENT MUSIC ENTERTAINM-ADR (TME) Fundamental Analysis & Valuation

NYSE:TME • US88034P1093

Current stock price

9.095 USD
-0.07 (-0.82%)
Last:

This TME fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

8

1. TME Profitability Analysis

1.1 Basic Checks

  • In the past year TME was profitable.
  • In the past year TME had a positive cash flow from operations.
  • In the past 5 years TME has always been profitable.
  • TME had a positive operating cash flow in each of the past 5 years.
TME Yearly Net Income VS EBIT VS OCF VS FCFTME Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B 10B

1.2 Ratios

  • With an excellent Return On Assets value of 10.78%, TME belongs to the best of the industry, outperforming 92.41% of the companies in the same industry.
  • TME's Return On Equity of 13.77% is amongst the best of the industry. TME outperforms 88.61% of its industry peers.
  • With an excellent Return On Invested Capital value of 9.20%, TME belongs to the best of the industry, outperforming 87.34% of the companies in the same industry.
  • TME had an Average Return On Invested Capital over the past 3 years of 7.93%. This is significantly below the industry average of 159.15%.
  • The 3 year average ROIC (7.93%) for TME is below the current ROIC(9.20%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 10.78%
ROE 13.77%
ROIC 9.2%
ROA(3y)8.21%
ROA(5y)6.93%
ROE(3y)10.79%
ROE(5y)9.21%
ROIC(3y)7.93%
ROIC(5y)6.53%
TME Yearly ROA, ROE, ROICTME Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2 4 6 8 10

1.3 Margins

  • With an excellent Profit Margin value of 33.60%, TME belongs to the best of the industry, outperforming 97.47% of the companies in the same industry.
  • In the last couple of years the Profit Margin of TME has grown nicely.
  • The Operating Margin of TME (29.41%) is better than 96.20% of its industry peers.
  • In the last couple of years the Operating Margin of TME has grown nicely.
  • With a Gross Margin value of 44.18%, TME perfoms like the industry average, outperforming 50.63% of the companies in the same industry.
  • TME's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 29.41%
PM (TTM) 33.6%
GM 44.18%
OM growth 3Y37.37%
OM growth 5Y18.14%
PM growth 3Y37.33%
PM growth 5Y18.71%
GM growth 3Y12.58%
GM growth 5Y6.72%
TME Yearly Profit, Operating, Gross MarginsTME Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 20 30 40

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8

2. TME Health Analysis

2.1 Basic Checks

  • TME has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • The number of shares outstanding for TME has been increased compared to 1 year ago.
  • TME has less shares outstanding than it did 5 years ago.
  • The debt/assets ratio for TME has been reduced compared to a year ago.
TME Yearly Shares OutstandingTME Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B
TME Yearly Total Debt VS Total AssetsTME Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20B 40B 60B 80B 100B

2.2 Solvency

  • An Altman-Z score of 4.15 indicates that TME is not in any danger for bankruptcy at the moment.
  • The Altman-Z score of TME (4.15) is better than 86.08% of its industry peers.
  • TME has a debt to FCF ratio of 0.41. This is a very positive value and a sign of high solvency as it would only need 0.41 years to pay back of all of its debts.
  • TME has a better Debt to FCF ratio (0.41) than 86.08% of its industry peers.
  • TME has a Debt/Equity ratio of 0.05. This is a healthy value indicating a solid balance between debt and equity.
  • With a decent Debt to Equity ratio value of 0.05, TME is doing good in the industry, outperforming 70.89% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.05
Debt/FCF 0.41
Altman-Z 4.15
ROIC/WACC1.21
WACC7.58%
TME Yearly LT Debt VS Equity VS FCFTME Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20B 40B 60B 80B

2.3 Liquidity

  • A Current Ratio of 2.22 indicates that TME has no problem at all paying its short term obligations.
  • The Current ratio of TME (2.22) is better than 79.75% of its industry peers.
  • TME has a Quick Ratio of 2.22. This indicates that TME is financially healthy and has no problem in meeting its short term obligations.
  • Looking at the Quick ratio, with a value of 2.22, TME is in the better half of the industry, outperforming 79.75% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.22
Quick Ratio 2.22
TME Yearly Current Assets VS Current LiabilitesTME Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

6

3. TME Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an impressive 25.66% over the past year.
  • The Earnings Per Share has been growing by 15.90% on average over the past years. This is quite good.
  • The Revenue has grown by 15.85% in the past year. This is quite good.
  • TME shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.45% yearly.
EPS 1Y (TTM)25.66%
EPS 3Y28.03%
EPS 5Y15.9%
EPS Q2Q%8.84%
Revenue 1Y (TTM)15.85%
Revenue growth 3Y5.1%
Revenue growth 5Y2.45%
Sales Q2Q%15.86%

3.2 Future

  • The Earnings Per Share is expected to grow by 14.00% on average over the next years. This is quite good.
  • TME is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.27% yearly.
EPS Next Y8.41%
EPS Next 2Y9.37%
EPS Next 3Y9.42%
EPS Next 5Y14%
Revenue Next Year10.8%
Revenue Next 2Y10.49%
Revenue Next 3Y10.23%
Revenue Next 5Y12.27%

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
  • The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
TME Yearly Revenue VS EstimatesTME Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 10B 20B 30B 40B 50B
TME Yearly EPS VS EstimatesTME Yearly EPS VS EstimatesYearly EPS VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 5 10 15

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8

4. TME Valuation Analysis

4.1 Price/Earnings Ratio

  • With a Price/Earnings ratio of 10.11, the valuation of TME can be described as very reasonable.
  • 92.41% of the companies in the same industry are more expensive than TME, based on the Price/Earnings ratio.
  • TME is valuated cheaply when we compare the Price/Earnings ratio to 26.77, which is the current average of the S&P500 Index.
  • TME is valuated reasonably with a Price/Forward Earnings ratio of 9.29.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of TME indicates a rather cheap valuation: TME is cheaper than 94.94% of the companies listed in the same industry.
  • TME is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.75, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 10.11
Fwd PE 9.29
TME Price Earnings VS Forward Price EarningsTME Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40 50

4.2 Price Multiples

  • TME's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. TME is cheaper than 87.34% of the companies in the same industry.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of TME indicates a rather cheap valuation: TME is cheaper than 91.14% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 10.24
EV/EBITDA 5.44
TME Per share dataTME EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6

4.3 Compensation for Growth

  • TME's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • TME has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.2
PEG (5Y)0.64
EPS Next 2Y9.37%
EPS Next 3Y9.42%

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4

5. TME Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 2.52%, TME has a reasonable but not impressive dividend return.
  • In the last 3 months the price of TME has falen by -45.35%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
  • TME's Dividend Yield is rather good when compared to the industry average which is at 10.57. TME pays more dividend than 93.67% of the companies in the same industry.
  • TME's Dividend Yield is a higher than the S&P500 average which is at 1.82.
Industry RankSector Rank
Dividend Yield 2.52%

5.2 History

  • TME has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years2
TME Yearly Dividends per shareTME Yearly Dividends per shareYearly Dividends per share 2024 2025 2026 0.05 0.1 0.15 0.2

5.3 Sustainability

  • TME pays out 17.92% of its income as dividend. This is a sustainable payout ratio.
DP17.92%
EPS Next 2Y9.37%
EPS Next 3Y9.42%
TME Yearly Income VS Free CF VS DividendTME Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B 10B
TME Dividend Payout.TME Dividend Payout, showing the Payout Ratio.TME Dividend Payout.PayoutRetained Earnings

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TME Fundamentals: All Metrics, Ratios and Statistics

TENCENT MUSIC ENTERTAINM-ADR

NYSE:TME (5/1/2026, 11:19:09 AM)

9.095

-0.07 (-0.82%)

Chartmill FA Rating
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Industry StrengthN/A
Industry GrowthN/A
Earnings (Last)03-17
Earnings (Next)05-12
Inst Owners67.52%
Inst Owner Change-1.04%
Ins Owners0%
Ins Owner Change0%
Market Cap14.01B
Revenue(TTM)32.90B
Net Income(TTM)11.06B
Analysts77.71
Price Target19.77 (117.37%)
Short Float %4.36%
Short Ratio1.53
Dividend
Industry RankSector Rank
Dividend Yield 2.52%
Yearly Dividend0.19
Dividend Growth(5Y)N/A
DP17.92%
Div Incr Years2
Div Non Decr Years2
Ex-Date04-02
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.38%
Min EPS beat(2)-0.87%
Max EPS beat(2)0.1%
EPS beat(4)3
Avg EPS beat(4)3.43%
Min EPS beat(4)-0.87%
Max EPS beat(4)12.25%
EPS beat(8)6
Avg EPS beat(8)3.48%
EPS beat(12)9
Avg EPS beat(12)3.18%
EPS beat(16)13
Avg EPS beat(16)4.57%
Revenue beat(2)2
Avg Revenue beat(2)1.7%
Min Revenue beat(2)1.52%
Max Revenue beat(2)1.88%
Revenue beat(4)4
Avg Revenue beat(4)2.13%
Min Revenue beat(4)0.15%
Max Revenue beat(4)4.97%
Revenue beat(8)6
Avg Revenue beat(8)1.09%
Revenue beat(12)9
Avg Revenue beat(12)1.14%
Revenue beat(16)12
Avg Revenue beat(16)1.2%
PT rev (1m)-23.83%
PT rev (3m)-24.57%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-9.22%
EPS NY rev (1m)-2.63%
EPS NY rev (3m)-2.71%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-6.02%
Revenue NY rev (1m)-1.28%
Revenue NY rev (3m)-2.08%
Valuation
Industry RankSector Rank
PE 10.11
Fwd PE 9.29
P/S 2.91
P/FCF 10.24
P/OCF 9.35
P/B 1.19
P/tB 1.68
EV/EBITDA 5.44
EPS(TTM)0.9
EY9.9%
EPS(NY)0.98
Fwd EY10.77%
FCF(TTM)0.89
FCFY9.77%
OCF(TTM)0.97
OCFY10.69%
SpS3.13
BVpS7.63
TBVpS5.4
PEG (NY)1.2
PEG (5Y)0.64
Graham Number12.4301 (36.67%)
Profitability
Industry RankSector Rank
ROA 10.78%
ROE 13.77%
ROCE 11.01%
ROIC 9.2%
ROICexc 12.71%
ROICexgc 20.12%
OM 29.41%
PM (TTM) 33.6%
GM 44.18%
FCFM 28.41%
ROA(3y)8.21%
ROA(5y)6.93%
ROE(3y)10.79%
ROE(5y)9.21%
ROIC(3y)7.93%
ROIC(5y)6.53%
ROICexc(3y)11.11%
ROICexc(5y)9.47%
ROICexgc(3y)19.06%
ROICexgc(5y)18.86%
ROCE(3y)9.49%
ROCE(5y)7.81%
ROICexgc growth 3Y-2.06%
ROICexgc growth 5Y-3.23%
ROICexc growth 3Y17.63%
ROICexc growth 5Y5.92%
OM growth 3Y37.37%
OM growth 5Y18.14%
PM growth 3Y37.33%
PM growth 5Y18.71%
GM growth 3Y12.58%
GM growth 5Y6.72%
F-Score7
Asset Turnover0.32
Health
Industry RankSector Rank
Debt/Equity 0.05
Debt/FCF 0.41
Debt/EBITDA 0.33
Cap/Depr 64.22%
Cap/Sales 2.68%
Interest Coverage 250
Cash Conversion 92.56%
Profit Quality 84.55%
Current Ratio 2.22
Quick Ratio 2.22
Altman-Z 4.15
F-Score7
WACC7.58%
ROIC/WACC1.21
Cap/Depr(3y)95.23%
Cap/Depr(5y)130.4%
Cap/Sales(3y)3.5%
Cap/Sales(5y)4.61%
Profit Quality(3y)116.38%
Profit Quality(5y)121.17%
High Growth Momentum
Growth
EPS 1Y (TTM)25.66%
EPS 3Y28.03%
EPS 5Y15.9%
EPS Q2Q%8.84%
EPS Next Y8.41%
EPS Next 2Y9.37%
EPS Next 3Y9.42%
EPS Next 5Y14%
Revenue 1Y (TTM)15.85%
Revenue growth 3Y5.1%
Revenue growth 5Y2.45%
Sales Q2Q%15.86%
Revenue Next Year10.8%
Revenue Next 2Y10.49%
Revenue Next 3Y10.23%
Revenue Next 5Y12.27%
EBIT growth 1Y31.69%
EBIT growth 3Y44.37%
EBIT growth 5Y21.03%
EBIT Next Year-1.25%
EBIT Next 3Y6.54%
EBIT Next 5Y9.74%
FCF growth 1Y1.14%
FCF growth 3Y13.3%
FCF growth 5Y16.35%
OCF growth 1Y-0.43%
OCF growth 3Y11%
OCF growth 5Y15.93%

TENCENT MUSIC ENTERTAINM-ADR / TME Fundamental Analysis FAQ

What is the fundamental rating for TME stock?

ChartMill assigns a fundamental rating of 7 / 10 to TME.


What is the valuation status of TENCENT MUSIC ENTERTAINM-ADR (TME) stock?

ChartMill assigns a valuation rating of 8 / 10 to TENCENT MUSIC ENTERTAINM-ADR (TME). This can be considered as Undervalued.


Can you provide the profitability details for TENCENT MUSIC ENTERTAINM-ADR?

TENCENT MUSIC ENTERTAINM-ADR (TME) has a profitability rating of 8 / 10.


What is the valuation of TENCENT MUSIC ENTERTAINM-ADR based on its PE and PB ratios?

The Price/Earnings (PE) ratio for TENCENT MUSIC ENTERTAINM-ADR (TME) is 10.11 and the Price/Book (PB) ratio is 1.19.


Is the dividend of TENCENT MUSIC ENTERTAINM-ADR sustainable?

The dividend rating of TENCENT MUSIC ENTERTAINM-ADR (TME) is 4 / 10 and the dividend payout ratio is 17.92%.