TENCENT MUSIC ENTERTAINM-ADR (TME) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TME - US88034P1093 - ADR
18.45 USD
+0.46 (+2.56%)
18.5 USD
+0.05 (+0.27%)
Overall TME gets a fundamental rating of 7 out of 10. We evaluated TME against 80 industry peers in the Entertainment industry. TME gets an excellent profitability rating and is at the same time showing great financial health properties. TME is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! With these ratings, TME could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
TME had positive earnings in the past year.
TME had a positive operating cash flow in the past year.
TME had positive earnings in each of the past 5 years.
Each year in the past 5 years TME had a positive operating cash flow.
1.2 Ratios
The Return On Assets of TME (11.95%) is better than 90.00% of its industry peers.
Looking at the Return On Equity, with a value of 15.93%, TME belongs to the top of the industry, outperforming 85.00% of the companies in the same industry.
TME's Return On Invested Capital of 10.39% is amongst the best of the industry. TME outperforms 85.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TME is below the industry average of 9.33%.
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 better Profit Margin (34.08%) than 100.00% of its industry peers.
TME's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 28.82%, TME belongs to the best of the industry, outperforming 96.25% of the companies in the same industry.
TME's Operating Margin has improved in the last couple of years.
TME's Gross Margin of 43.90% is in line compared to the rest of the industry. TME outperforms 52.50% of its industry peers.
TME's Gross Margin has improved in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), TME 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 6.76 indicates that TME is not in any danger for bankruptcy at the moment.
TME's Altman-Z score of 6.76 is amongst the best of the industry. TME outperforms 86.25% of its industry peers.
The Debt to FCF ratio of TME is 0.59, which is an excellent value as it means it would take TME, only 0.59 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 0.59, TME belongs to the best of the industry, outperforming 86.25% of the companies in the same industry.
A Debt/Equity ratio of 0.06 indicates that TME is not too dependend on debt financing.
TME's Debt to Equity ratio of 0.06 is fine compared to the rest of the industry. TME outperforms 63.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.59 | ||
| Altman-Z | 6.76 |
ROIC/WACC1.49
WACC6.95%
2.3 Liquidity
TME has a Current Ratio of 2.09. This indicates that TME is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 2.09, TME is doing good in the industry, outperforming 80.00% of the companies in the same industry.
A Quick Ratio of 2.09 indicates that TME has no problem at all paying its short term obligations.
The Quick ratio of TME (2.09) is better than 80.00% 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.
The Earnings Per Share has been growing by 10.88% on average over the past years. This is quite good.
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 17.10% yearly.
Based on estimates for the next years, TME will show a quite strong growth in Revenue. The Revenue will grow by 15.18% on average per year.
EPS Next Y18.39%
EPS Next 2Y18.52%
EPS Next 3Y17.39%
EPS Next 5Y17.1%
Revenue Next Year14.37%
Revenue Next 2Y14.34%
Revenue Next 3Y13.42%
Revenue Next 5Y15.18%
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
TME is valuated rather expensively with a Price/Earnings ratio of 21.71.
Based on the Price/Earnings ratio, TME is valued cheaply inside the industry as 81.25% of the companies are valued more expensively.
TME's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.15.
With a Price/Forward Earnings ratio of 18.95, TME is valued on the expensive side.
Based on the Price/Forward Earnings ratio, TME is valued cheaper than 85.00% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 36.12. TME is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.71 | ||
| Fwd PE | 18.95 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TME is valued a bit cheaper than the industry average as 63.75% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, TME is valued cheaply inside the industry as 83.75% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.51 | ||
| EV/EBITDA | 15.92 |
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.
TME's earnings are expected to grow with 17.39% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.18
PEG (5Y)2
EPS Next 2Y18.52%
EPS Next 3Y17.39%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.74%, TME has a reasonable but not impressive dividend return.
The stock price of TME dropped by -24.76% 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.
TME's Dividend Yield is rather good when compared to the industry average which is at 44.93. TME pays more dividend than 88.75% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.41, TME is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.74% |
5.2 History
TME does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
DPN/A
EPS Next 2Y18.52%
EPS Next 3Y17.39%
18.45
+0.46 (+2.56%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners67.61%
Inst Owner Change-5.67%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap28.43B
Revenue(TTM)31.72B
Net Income(TTM)10.81B
Analysts80.57
Price Target26.72 (44.82%)
Short Float %4.39%
Short Ratio2.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.74% |
Yearly Dividend0.13
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years1
Div Non Decr Years1
Ex-Date
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)-4.57%
PT rev (3m)2.5%
EPS NQ rev (1m)-0.3%
EPS NQ rev (3m)-0.12%
EPS NY rev (1m)0.33%
EPS NY rev (3m)0.39%
Revenue NQ rev (1m)0.48%
Revenue NQ rev (3m)0.91%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.71 | ||
| Fwd PE | 18.95 | ||
| P/S | 6.35 | ||
| P/FCF | 19.51 | ||
| P/OCF | 19.51 | ||
| P/B | 2.97 | ||
| P/tB | 4.36 | ||
| EV/EBITDA | 15.92 |
EPS(TTM)0.85
EY4.61%
EPS(NY)0.97
Fwd EY5.28%
FCF(TTM)0.95
FCFY5.12%
OCF(TTM)0.95
OCFY5.12%
SpS2.91
BVpS6.22
TBVpS4.23
PEG (NY)1.18
PEG (5Y)2
Graham Number10.9
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 | 6.76 |
F-Score5
WACC6.95%
ROIC/WACC1.49
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 Y18.39%
EPS Next 2Y18.52%
EPS Next 3Y17.39%
EPS Next 5Y17.1%
Revenue 1Y (TTM)13.95%
Revenue growth 3Y-3.13%
Revenue growth 5Y2.23%
Sales Q2Q%20.64%
Revenue Next Year14.37%
Revenue Next 2Y14.34%
Revenue Next 3Y13.42%
Revenue Next 5Y15.18%
EBIT growth 1Y37.58%
EBIT growth 3Y39.33%
EBIT growth 5Y13.34%
EBIT Next Year50.31%
EBIT Next 3Y25.28%
EBIT Next 5Y22.89%
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 7 / 10 to TME.
Can you provide the valuation status for TENCENT MUSIC ENTERTAINM-ADR?
ChartMill assigns a valuation rating of 6 / 10 to TENCENT MUSIC ENTERTAINM-ADR (TME). This can be considered as Fairly Valued.
How profitable is TENCENT MUSIC ENTERTAINM-ADR (TME) stock?
TENCENT MUSIC ENTERTAINM-ADR (TME) has a profitability rating of 8 / 10.
What is the earnings growth outlook for TENCENT MUSIC ENTERTAINM-ADR?
The Earnings per Share (EPS) of TENCENT MUSIC ENTERTAINM-ADR (TME) is expected to grow by 18.39% in the next year.