TENCENT MUSIC ENTERTAINM-ADR (TME) Stock Fundamental Analysis
USA - NYSE:TME - US88034P1093 - ADR
18.7065 USD
-0.19 (-1.02%)
Taking everything into account, TME scores 7 out of 10 in our fundamental rating. TME was compared to 79 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 not priced too expensively while it is growing strongly. Keep and eye on this one! This makes TME very considerable 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.
TME had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 11.95%, TME belongs to the best of the industry, outperforming 89.87% of the companies in the same industry.
TME has a Return On Equity of 15.93%. This is amongst the best in the industry. TME outperforms 84.81% of its industry peers.
The Return On Invested Capital of TME (10.39%) is better than 84.81% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TME is below the industry average of 9.82%.
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
The Profit Margin of TME (34.08%) is better than 100.00% of its industry peers.
In the last couple of years the Profit Margin of TME has grown nicely.
TME has a better Operating Margin (28.82%) than 96.20% of its industry peers.
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 51.90% 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
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
Compared to 5 years ago, TME has less shares outstanding
The debt/assets ratio for TME has been reduced compared to a year ago.
2.2 Solvency
TME has an Altman-Z score of 7.04. This indicates that TME is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 7.04, TME belongs to the top of the industry, outperforming 89.87% 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.
Looking at the Debt to FCF ratio, with a value of 0.59, TME belongs to the top of the industry, outperforming 86.08% 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.
TME has a better Debt to Equity ratio (0.06) than 64.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.59 | ||
| Altman-Z | 7.04 |
ROIC/WACC1.49
WACC6.97%
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 79.75% 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 Quick ratio of 2.09. This is in the better half of the industry: TME outperforms 79.75% 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.
The Revenue is expected to grow by 15.18% on average over the next years. This is quite good.
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 22.01.
TME's Price/Earnings ratio is a bit cheaper when compared to the industry. TME is cheaper than 79.75% of the companies in the same industry.
TME's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.56.
With a Price/Forward Earnings ratio of 19.28, TME is valued on the expensive side.
Based on the Price/Forward Earnings ratio, TME is valued cheaper than 82.28% of the companies in the same industry.
TME's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 34.62.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.01 | ||
| Fwd PE | 19.28 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TME is valued a bit cheaper than the industry average as 62.03% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, TME is valued cheaply inside the industry as 81.01% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.85 | ||
| EV/EBITDA | 16.98 |
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.
A more expensive valuation may be justified as TME's earnings are expected to grow with 17.39% in the coming years.
PEG (NY)1.2
PEG (5Y)2.02
EPS Next 2Y18.52%
EPS Next 3Y17.39%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.62%, TME has a reasonable but not impressive dividend return.
In the last 3 months the price of TME has falen by -25.44%. 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 41.64. TME pays more dividend than 88.61% of the companies in the same industry.
TME's Dividend Yield is slightly below the S&P500 average, which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
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%
NYSE:TME (11/18/2025, 3:58:05 PM)
18.7065
-0.19 (-1.02%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners67.61%
Inst Owner Change-5.5%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap28.83B
Revenue(TTM)31.72B
Net Income(TTM)10.81B
Analysts80.57
Price Target26.72 (42.84%)
Short Float %4.39%
Short Ratio2.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
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)-0.31%
PT rev (3m)42.03%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.74%
EPS NY rev (1m)0.33%
EPS NY rev (3m)4.51%
Revenue NQ rev (1m)0.2%
Revenue NQ rev (3m)2.3%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)3.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.01 | ||
| Fwd PE | 19.28 | ||
| P/S | 6.46 | ||
| P/FCF | 19.85 | ||
| P/OCF | 19.85 | ||
| P/B | 3.02 | ||
| P/tB | 4.44 | ||
| EV/EBITDA | 16.98 |
EPS(TTM)0.85
EY4.54%
EPS(NY)0.97
Fwd EY5.19%
FCF(TTM)0.94
FCFY5.04%
OCF(TTM)0.94
OCFY5.04%
SpS2.9
BVpS6.2
TBVpS4.22
PEG (NY)1.2
PEG (5Y)2.02
Graham Number10.89
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 | 7.04 |
F-Score5
WACC6.97%
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.