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

NYSE:TME • US88034P1093

Current stock price

9.1 USD
-0.07 (-0.76%)
At close:
9.0948 USD
-0.01 (-0.06%)
After Hours:

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

  • TME had positive earnings in the past year.
  • In the past year TME had a positive cash flow from operations.
  • TME had positive earnings in each of the past 5 years.
  • In the past 5 years TME always reported a positive cash flow from operatings.
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

  • TME has a better Return On Assets (10.78%) than 92.41% of its industry peers.
  • The Return On Equity of TME (13.77%) is better than 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

  • TME has a Profit Margin of 33.60%. This is amongst the best in the industry. TME outperforms 97.47% of its industry peers.
  • TME's Profit Margin has improved in the last couple of years.
  • Looking at the Operating Margin, with a value of 29.41%, TME belongs to the top of the industry, outperforming 96.20% of the companies in the same industry.
  • TME's Operating Margin has improved in the last couple of years.
  • Looking at the Gross Margin, with a value of 44.18%, TME is in line with its industry, 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

  • The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TME is still 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

  • TME has an Altman-Z score of 4.15. This indicates that TME is financially healthy and has little risk of bankruptcy at the moment.
  • TME has a Altman-Z score of 4.15. This is amongst the best in the industry. TME outperforms 86.08% of its industry peers.
  • The Debt to FCF ratio of TME is 0.41, which is an excellent value as it means it would take TME, only 0.41 years of fcf income to pay off all of its debts.
  • TME has a better Debt to FCF ratio (0.41) than 86.08% of its industry peers.
  • A Debt/Equity ratio of 0.05 indicates that TME is not too dependend on debt financing.
  • Looking at the Debt to Equity ratio, with a value of 0.05, TME is in the better half of 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
WACC7.59%
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.
  • Looking at the Current 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.
  • 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.
  • The Quick ratio of TME (2.22) is better than 79.75% of its industry peers.
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.
  • Measured over the past years, TME shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.90% on average per year.
  • The Revenue has grown by 15.85% in the past year. This is quite good.
  • Measured over the past years, TME shows a small growth in Revenue. The Revenue has been growing by 2.45% on average per year.
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

  • The EPS growth rate is stable: in the next years the growth will be about the same 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.
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

  • A Price/Earnings ratio of 10.11 indicates a reasonable valuation of TME.
  • Based on the Price/Earnings ratio, TME is valued cheaply inside the industry as 92.41% of the companies are valued more expensively.
  • The average S&P500 Price/Earnings ratio is at 26.51. TME is valued rather cheaply when compared to this.
  • The Price/Forward Earnings ratio is 9.29, which indicates a very decent valuation of TME.
  • TME's Price/Forward Earnings ratio is rather cheap when compared to the industry. TME is cheaper than 94.94% of the companies in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 21.41, TME is valued rather cheaply.
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

  • Based on the Enterprise Value to EBITDA ratio, TME is valued cheaply inside the industry as 88.61% of the companies are valued more expensively.
  • 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 10.3
EV/EBITDA 5.42
TME Per share dataTME EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6

4.3 Compensation for Growth

  • The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • The excellent profitability rating of TME 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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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

4

5. TME Dividend Analysis

5.1 Amount

  • TME has a Yearly Dividend Yield of 2.54%. Purely for dividend investing, there may be better candidates out there.
  • The stock price of TME dropped by -45.77% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
  • Compared to an average industry Dividend Yield of 10.11, TME pays a better dividend. On top of this TME pays more dividend than 94.94% of the companies listed in the same industry.
  • TME's Dividend Yield is a higher than the S&P500 average which is at 1.80.
Industry RankSector Rank
Dividend Yield 2.54%

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

  • 17.92% of the earnings are spent on dividend by TME. This is a low number and 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, 8:04:00 PM)

After market: 9.0948 -0.01 (-0.06%)

9.1

-0.07 (-0.76%)

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-2.72%
Ins Owners0%
Ins Owner Change0%
Market Cap14.10B
Revenue(TTM)32.90B
Net Income(TTM)11.06B
Analysts77.71
Price Target18.96 (108.35%)
Short Float %4.36%
Short Ratio1.53
Dividend
Industry RankSector Rank
Dividend Yield 2.54%
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)-6.11%
PT rev (3m)-27.69%
EPS NQ rev (1m)0.16%
EPS NQ rev (3m)-9.08%
EPS NY rev (1m)-2.63%
EPS NY rev (3m)-2.71%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)-6%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.08%
Valuation
Industry RankSector Rank
PE 10.11
Fwd PE 9.29
P/S 2.93
P/FCF 10.3
P/OCF 9.41
P/B 1.2
P/tB 1.69
EV/EBITDA 5.42
EPS(TTM)0.9
EY9.89%
EPS(NY)0.98
Fwd EY10.76%
FCF(TTM)0.88
FCFY9.71%
OCF(TTM)0.97
OCFY10.62%
SpS3.11
BVpS7.59
TBVpS5.37
PEG (NY)1.2
PEG (5Y)0.64
Graham Number12.3951 (36.21%)
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
WACC7.59%
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 1.2.


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%.