TENCENT MUSIC ENTERTAINM-ADR (TME) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TME - US88034P1093 - ADR
16.58 USD
-0.02 (-0.12%)
16.58 USD
0 (0%)
Overall TME gets a fundamental rating of 8 out of 10. We evaluated TME against 80 industry peers in the Entertainment industry. TME scores excellent points on both the profitability and health parts. This is a solid base for a good stock. TME has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination! These ratings could make TME a good candidate for value and growth and quality investing.
1. Profitability
1.1 Basic Checks
- In the past year TME was profitable.
- TME had a positive operating cash flow in the past year.
- Each year in the past 5 years TME has been profitable.
- Each year in the past 5 years TME had a positive operating cash flow.
1.2 Ratios
- TME's Return On Assets of 11.95% is amongst the best of the industry. TME outperforms 91.25% of its industry peers.
- TME's Return On Equity of 15.93% is amongst the best of the industry. TME outperforms 86.25% of its industry peers.
- The Return On Invested Capital of TME (10.39%) is better than 87.50% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for TME is below the industry average of 8.70%.
- The 3 year average ROIC (6.52%) for TME is below the current ROIC(10.39%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.95% | ||
| ROE | 15.93% | ||
| ROIC | 10.39% |
ROA(3y)6.45%
ROA(5y)5.99%
ROE(3y)8.75%
ROE(5y)8.04%
ROIC(3y)6.52%
ROIC(5y)5.78%
1.3 Margins
- TME has a Profit Margin of 34.08%. This is amongst the best in the industry. TME outperforms 100.00% of its industry peers.
- TME's Profit Margin has improved in the last couple of years.
- TME has a Operating Margin of 28.82%. This is amongst the best in the industry. TME outperforms 96.25% of its industry peers.
- In the last couple of years the Operating Margin of TME has grown nicely.
- The Gross Margin of TME (43.90%) is comparable to the rest of the industry.
- In the last couple of years the Gross Margin of TME has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.82% | ||
| PM (TTM) | 34.08% | ||
| GM | 43.9% |
OM growth 3Y43.83%
OM growth 5Y10.87%
PM growth 3Y34.13%
PM growth 5Y8.36%
GM growth 3Y12.05%
GM growth 5Y4.42%
2. Health
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.
- TME has less shares outstanding than it did 1 year ago.
- Compared to 5 years ago, TME has less shares outstanding
- TME has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 6.27 indicates that TME is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 6.27, TME belongs to the top of the industry, outperforming 88.75% of the companies in the same industry.
- TME has a debt to FCF ratio of 0.59. This is a very positive value and a sign of high solvency as it would only need 0.59 years to pay back of all of its debts.
- TME has a better Debt to FCF ratio (0.59) than 87.50% of its industry peers.
- TME has a Debt/Equity ratio of 0.06. This is a healthy value indicating a solid balance between debt and equity.
- With a decent Debt to Equity ratio value of 0.06, TME is doing good in the industry, outperforming 66.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.59 | ||
| Altman-Z | 6.27 |
ROIC/WACC1.14
WACC9.13%
2.3 Liquidity
- A Current Ratio of 2.09 indicates that TME has no problem at all paying its short term obligations.
- The Current ratio of TME (2.09) is better than 76.25% of its industry peers.
- TME has a Quick Ratio of 2.09. This indicates that TME is financially healthy and has no problem in meeting its short term obligations.
- TME has a better Quick ratio (2.09) than 76.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.09 | ||
| Quick Ratio | 2.09 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 36.04% over the past year.
- TME shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.88% yearly.
- The Revenue has grown by 13.95% 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 2.23% yearly.
EPS 1Y (TTM)36.04%
EPS 3Y25.91%
EPS 5Y10.88%
EPS Q2Q%32.76%
Revenue 1Y (TTM)13.95%
Revenue growth 3Y-3.13%
Revenue growth 5Y2.23%
Sales Q2Q%20.64%
3.2 Future
- TME is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.91% yearly.
- TME is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.77% yearly.
EPS Next Y22.26%
EPS Next 2Y18.33%
EPS Next 3Y16.43%
EPS Next 5Y16.91%
Revenue Next Year15.3%
Revenue Next 2Y14.22%
Revenue Next 3Y13.71%
Revenue Next 5Y14.77%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 19.06, TME is valued on the expensive side.
- 81.25% of the companies in the same industry are more expensive than TME, based on the Price/Earnings ratio.
- TME is valuated rather cheaply when we compare the Price/Earnings ratio to 27.47, which is the current average of the S&P500 Index.
- TME is valuated correctly with a Price/Forward Earnings ratio of 16.81.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of TME indicates a rather cheap valuation: TME is cheaper than 85.00% of the companies listed in the same industry.
- TME is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.06 | ||
| Fwd PE | 16.81 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, TME is valued a bit cheaper than 70.00% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, TME is valued cheaper than 90.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.25 | ||
| EV/EBITDA | 14.12 |
4.3 Compensation for Growth
- TME's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The excellent profitability rating of TME may justify a higher PE ratio.
- TME's earnings are expected to grow with 16.43% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.86
PEG (5Y)1.75
EPS Next 2Y18.33%
EPS Next 3Y16.43%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.85%, TME has a reasonable but not impressive dividend return.
- In the last 3 months the price of TME has falen by -25.85%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
- Compared to an average industry Dividend Yield of 7.68, TME pays a better dividend. On top of this TME pays more dividend than 88.75% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.87, TME has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.85% |
5.2 History
- TME is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
DPN/A
EPS Next 2Y18.33%
EPS Next 3Y16.43%
16.58
-0.02 (-0.12%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)11-12 2025-11-12/bmo
Earnings (Next)03-16 2026-03-16/amc
Inst Owners62.89%
Inst Owner Change0.08%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap25.55B
Revenue(TTM)31.72B
Net Income(TTM)10.81B
Analysts80.57
Price Target26.22 (58.14%)
Short Float %4.01%
Short Ratio2.63
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.85% |
Yearly Dividend0.13
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.17%
Min EPS beat(2)0.1%
Max EPS beat(2)12.25%
EPS beat(4)4
Avg EPS beat(4)6.78%
Min EPS beat(4)0.1%
Max EPS beat(4)12.53%
EPS beat(8)7
Avg EPS beat(8)3.77%
EPS beat(12)10
Avg EPS beat(12)3.33%
EPS beat(16)13
Avg EPS beat(16)4.55%
Revenue beat(2)2
Avg Revenue beat(2)3.43%
Min Revenue beat(2)1.88%
Max Revenue beat(2)4.97%
Revenue beat(4)4
Avg Revenue beat(4)2.05%
Min Revenue beat(4)0.15%
Max Revenue beat(4)4.97%
Revenue beat(8)6
Avg Revenue beat(8)1.12%
Revenue beat(12)9
Avg Revenue beat(12)1.03%
Revenue beat(16)11
Avg Revenue beat(16)1.05%
PT rev (1m)-0.67%
PT rev (3m)-6.38%
EPS NQ rev (1m)0.11%
EPS NQ rev (3m)-0.32%
EPS NY rev (1m)0.16%
EPS NY rev (3m)3.61%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.78%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.06 | ||
| Fwd PE | 16.81 | ||
| P/S | 5.61 | ||
| P/FCF | 17.25 | ||
| P/OCF | 17.25 | ||
| P/B | 2.62 | ||
| P/tB | 3.86 | ||
| EV/EBITDA | 14.12 |
EPS(TTM)0.87
EY5.25%
EPS(NY)0.99
Fwd EY5.95%
FCF(TTM)0.96
FCFY5.8%
OCF(TTM)0.96
OCFY5.8%
SpS2.95
BVpS6.32
TBVpS4.3
PEG (NY)0.86
PEG (5Y)1.75
Graham Number11.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.95% | ||
| ROE | 15.93% | ||
| ROCE | 12.37% | ||
| ROIC | 10.39% | ||
| ROICexc | 16.44% | ||
| ROICexgc | 30.72% | ||
| OM | 28.82% | ||
| PM (TTM) | 34.08% | ||
| GM | 43.9% | ||
| FCFM | 32.54% |
ROA(3y)6.45%
ROA(5y)5.99%
ROE(3y)8.75%
ROE(5y)8.04%
ROIC(3y)6.52%
ROIC(5y)5.78%
ROICexc(3y)9.52%
ROICexc(5y)8.88%
ROICexgc(3y)19.59%
ROICexgc(5y)19.68%
ROCE(3y)7.76%
ROCE(5y)6.88%
ROICexgc growth 3Y16.02%
ROICexgc growth 5Y-26.04%
ROICexc growth 3Y28.21%
ROICexc growth 5Y-2.74%
OM growth 3Y43.83%
OM growth 5Y10.87%
PM growth 3Y34.13%
PM growth 5Y8.36%
GM growth 3Y12.05%
GM growth 5Y4.42%
F-Score5
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.59 | ||
| Debt/EBITDA | 0.37 | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 101.98% | ||
| Profit Quality | 95.47% | ||
| Current Ratio | 2.09 | ||
| Quick Ratio | 2.09 | ||
| Altman-Z | 6.27 |
F-Score5
WACC9.13%
ROIC/WACC1.14
Cap/Depr(3y)104.08%
Cap/Depr(5y)129.71%
Cap/Sales(3y)3.85%
Cap/Sales(5y)4.42%
Profit Quality(3y)146.47%
Profit Quality(5y)125.36%
High Growth Momentum
Growth
EPS 1Y (TTM)36.04%
EPS 3Y25.91%
EPS 5Y10.88%
EPS Q2Q%32.76%
EPS Next Y22.26%
EPS Next 2Y18.33%
EPS Next 3Y16.43%
EPS Next 5Y16.91%
Revenue 1Y (TTM)13.95%
Revenue growth 3Y-3.13%
Revenue growth 5Y2.23%
Sales Q2Q%20.64%
Revenue Next Year15.3%
Revenue Next 2Y14.22%
Revenue Next 3Y13.71%
Revenue Next 5Y14.77%
EBIT growth 1Y37.58%
EBIT growth 3Y39.33%
EBIT growth 5Y13.34%
EBIT Next Year51.35%
EBIT Next 3Y23.15%
EBIT Next 5Y22.61%
FCF growth 1Y31.4%
FCF growth 3Y55.02%
FCF growth 5Y9.34%
OCF growth 1Y31.4%
OCF growth 3Y25.17%
OCF growth 5Y10.63%
TENCENT MUSIC ENTERTAINM-ADR / TME FAQ
What is the fundamental rating for TME stock?
ChartMill assigns a fundamental rating of 8 / 10 to TME.
What is the valuation status of TENCENT MUSIC ENTERTAINM-ADR (TME) stock?
ChartMill assigns a valuation rating of 7 / 10 to TENCENT MUSIC ENTERTAINM-ADR (TME). This can be considered as Undervalued.
How profitable is TENCENT MUSIC ENTERTAINM-ADR (TME) stock?
TENCENT MUSIC ENTERTAINM-ADR (TME) has a profitability rating of 8 / 10.
What are the PE and PB ratios of TENCENT MUSIC ENTERTAINM-ADR (TME) stock?
The Price/Earnings (PE) ratio for TENCENT MUSIC ENTERTAINM-ADR (TME) is 19.06 and the Price/Book (PB) ratio is 2.62.
What is the expected EPS growth for TENCENT MUSIC ENTERTAINM-ADR (TME) stock?
The Earnings per Share (EPS) of TENCENT MUSIC ENTERTAINM-ADR (TME) is expected to grow by 22.26% in the next year.