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%)
TME gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 80 industry peers in the Entertainment industry. TME has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. TME is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings would make TME suitable for 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.
In the past 5 years TME has always been profitable.
In the past 5 years TME always reported a positive cash flow from operatings.
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.
With an excellent Return On Invested Capital value of 10.39%, TME belongs to the best of the industry, outperforming 85.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TME is below the industry average of 9.33%.
The last Return On Invested Capital (10.39%) for TME is above the 3 year average (6.52%), which is a sign of increasing profitability.
| 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's Profit Margin of 34.08% is amongst the best of the industry. TME outperforms 100.00% 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 28.82%, TME belongs to the top of the industry, outperforming 96.25% of the companies in the same industry.
In the last couple of years the Operating Margin of TME has grown nicely.
TME has a Gross Margin (43.90%) which is in line with its industry peers.
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TME is still creating some value.
Compared to 1 year ago, TME has less shares outstanding
The number of shares outstanding for TME has been reduced compared to 5 years ago.
TME has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 6.89 indicates that TME is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 6.89, TME belongs to the best of the industry, outperforming 86.25% of the companies in the same industry.
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.
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 63.75% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.59 | ||
| Altman-Z | 6.89 |
ROIC/WACC1.49
WACC6.95%
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 80.00% 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's Quick ratio of 2.09 is fine compared to the rest of the industry. TME outperforms 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.
Measured over the past years, TME shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.88% on average per year.
TME shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.95%.
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
The Earnings Per Share is expected to grow by 17.33% 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 15.04% yearly.
EPS Next Y18.39%
EPS Next 2Y18.52%
EPS Next 3Y17.39%
EPS Next 5Y17.33%
Revenue Next Year14.37%
Revenue Next 2Y14.34%
Revenue Next 3Y13.42%
Revenue Next 5Y15.04%
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 21.71, 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's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.31.
A Price/Forward Earnings ratio of 18.93 indicates a rather expensive valuation of TME.
Based on the Price/Forward Earnings ratio, TME is valued cheaper than 85.00% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TME to the average of the S&P500 Index (36.59), we can say TME is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.71 | ||
| Fwd PE | 18.93 |
4.2 Price Multiples
TME's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TME is cheaper than 62.50% of the companies in the same industry.
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 | 19.49 | ||
| EV/EBITDA | 16.4 |
4.3 Compensation for Growth
The 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.
A more expensive valuation may be justified as TME's earnings are expected to grow with 17.39% in the coming years.
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 1.71%, 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.
Compared to an average industry Dividend Yield of 37.57, 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 the average S&P500 Dividend Yield of 2.34, TME is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
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 2Y18.52%
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 | 1.71% |
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)-0.43%
EPS NQ rev (3m)-0.43%
EPS NY rev (1m)0.33%
EPS NY rev (3m)0.39%
Revenue NQ rev (1m)0.58%
Revenue NQ rev (3m)0.78%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.71 | ||
| Fwd PE | 18.93 | ||
| P/S | 6.34 | ||
| P/FCF | 19.49 | ||
| P/OCF | 19.49 | ||
| P/B | 2.96 | ||
| P/tB | 4.36 | ||
| EV/EBITDA | 16.4 |
EPS(TTM)0.85
EY4.61%
EPS(NY)0.97
Fwd EY5.28%
FCF(TTM)0.95
FCFY5.13%
OCF(TTM)0.95
OCFY5.13%
SpS2.91
BVpS6.22
TBVpS4.23
PEG (NY)1.18
PEG (5Y)2
Graham Number10.91
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 | 6.89 |
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 5Y17.33%
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 5Y15.04%
EBIT growth 1Y37.58%
EBIT growth 3Y39.33%
EBIT growth 5Y13.34%
EBIT Next Year50.31%
EBIT Next 3Y25.28%
EBIT Next 5Y22.9%
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.