WARNER MUSIC GROUP CORP-CL A (WMG) Fundamental Analysis & Valuation

NASDAQ:WMG • US9345502036

Current stock price

28.5 USD
+0.38 (+1.35%)
At close:
28.24 USD
-0.26 (-0.91%)
After Hours:

This WMG fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

8

1. WMG Profitability Analysis

1.1 Basic Checks

  • In the past year WMG was profitable.
  • In the past year WMG had a positive cash flow from operations.
  • In the past 5 years WMG has always been profitable.
  • In the past 5 years WMG always reported a positive cash flow from operatings.
WMG Yearly Net Income VS EBIT VS OCF VS FCFWMG 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 0 500M

1.2 Ratios

  • Looking at the Return On Assets, with a value of 2.99%, WMG is in the better half of the industry, outperforming 75.95% of the companies in the same industry.
  • WMG's Return On Equity of 41.52% is amongst the best of the industry. WMG outperforms 97.47% of its industry peers.
  • The Return On Invested Capital of WMG (13.79%) is better than 93.67% of its industry peers.
  • The Average Return On Invested Capital over the past 3 years for WMG is significantly above the industry average of 7.26%.
  • The last Return On Invested Capital (13.79%) for WMG is above the 3 year average (13.09%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 2.99%
ROE 41.52%
ROIC 13.79%
ROA(3y)4.44%
ROA(5y)4.89%
ROE(3y)92.24%
ROE(5y)320.47%
ROIC(3y)13.09%
ROIC(5y)12.66%
WMG Yearly ROA, ROE, ROICWMG Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200 400 600 800

1.3 Margins

  • The Profit Margin of WMG (4.35%) is better than 74.68% of its industry peers.
  • In the last couple of years the Profit Margin of WMG has declined.
  • Looking at the Operating Margin, with a value of 14.74%, WMG belongs to the top of the industry, outperforming 87.34% of the companies in the same industry.
  • In the last couple of years the Operating Margin of WMG has grown nicely.
  • The Gross Margin of WMG (45.87%) is comparable to the rest of the industry.
  • In the last couple of years the Gross Margin of WMG has remained more or less at the same level.
Industry RankSector Rank
OM 14.74%
PM (TTM) 4.35%
GM 45.87%
OM growth 3Y4.68%
OM growth 5YN/A
PM growth 3Y-16.34%
PM growth 5YN/A
GM growth 3Y-1.49%
GM growth 5Y-0.8%
WMG Yearly Profit, Operating, Gross MarginsWMG Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 10 -10 20 30 40

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2

2. WMG Health Analysis

2.1 Basic Checks

  • WMG has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • Compared to 1 year ago, WMG has more shares outstanding
  • Compared to 5 years ago, WMG has more shares outstanding
  • Compared to 1 year ago, WMG has a worse debt to assets ratio.
WMG Yearly Shares OutstandingWMG Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 100M 200M 300M 400M 500M
WMG Yearly Total Debt VS Total AssetsWMG Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B

2.2 Solvency

  • Based on the Altman-Z score of 1.65, we must say that WMG is in the distress zone and has some risk of bankruptcy.
  • The Altman-Z score of WMG (1.65) is better than 60.76% of its industry peers.
  • The Debt to FCF ratio of WMG is 9.50, which is on the high side as it means it would take WMG, 9.50 years of fcf income to pay off all of its debts.
  • WMG's Debt to FCF ratio of 9.50 is fine compared to the rest of the industry. WMG outperforms 72.15% of its industry peers.
  • A Debt/Equity ratio of 6.07 is on the high side and indicates that WMG has dependencies on debt financing.
  • WMG has a Debt to Equity ratio of 6.07. This is in the lower half of the industry: WMG underperforms 77.22% of its industry peers.
Industry RankSector Rank
Debt/Equity 6.07
Debt/FCF 9.5
Altman-Z 1.65
ROIC/WACC1.62
WACC8.49%
WMG Yearly LT Debt VS Equity VS FCFWMG Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B 2B 3B 4B

2.3 Liquidity

  • WMG has a Current Ratio of 0.70. This is a bad value and indicates that WMG is not financially healthy enough and could expect problems in meeting its short term obligations.
  • WMG has a worse Current ratio (0.70) than 64.56% of its industry peers.
  • WMG has a Quick Ratio of 0.70. This is a bad value and indicates that WMG is not financially healthy enough and could expect problems in meeting its short term obligations.
  • With a Quick ratio value of 0.69, WMG is not doing good in the industry: 63.29% of the companies in the same industry are doing better.
Industry RankSector Rank
Current Ratio 0.7
Quick Ratio 0.69
WMG Yearly Current Assets VS Current LiabilitesWMG Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. WMG Growth Analysis

3.1 Past

  • The earnings per share for WMG have decreased strongly by -53.23% in the last year.
  • WMG shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -12.92% yearly.
  • The Revenue has grown by 8.46% in the past year. This is quite good.
  • WMG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.49% yearly.
EPS 1Y (TTM)-53.23%
EPS 3Y-12.92%
EPS 5YN/A
EPS Q2Q%-26.67%
Revenue 1Y (TTM)8.46%
Revenue growth 3Y4.25%
Revenue growth 5Y8.49%
Sales Q2Q%10.44%

3.2 Future

  • The Earnings Per Share is expected to grow by 25.64% on average over the next years. This is a very strong growth
  • Based on estimates for the next years, WMG will show a small growth in Revenue. The Revenue will grow by 6.05% on average per year.
EPS Next Y93%
EPS Next 2Y57.05%
EPS Next 3Y40.46%
EPS Next 5Y25.64%
Revenue Next Year8.98%
Revenue Next 2Y7.51%
Revenue Next 3Y6.89%
Revenue Next 5Y6.05%

3.3 Evolution

  • The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
WMG Yearly Revenue VS EstimatesWMG Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2B 4B 6B 8B
WMG Yearly EPS VS EstimatesWMG Yearly EPS VS EstimatesYearly EPS VS Estimates 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0 0.5 -0.5 1 1.5 2

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6

4. WMG Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 49.14, the valuation of WMG can be described as expensive.
  • Based on the Price/Earnings ratio, WMG is valued a bit cheaper than 68.35% of the companies in the same industry.
  • WMG is valuated expensively when we compare the Price/Earnings ratio to 26.78, which is the current average of the S&P500 Index.
  • With a Price/Forward Earnings ratio of 16.51, WMG is valued correctly.
  • Based on the Price/Forward Earnings ratio, WMG is valued cheaply inside the industry as 86.08% of the companies are valued more expensively.
  • When comparing the Price/Forward Earnings ratio of WMG to the average of the S&P500 Index (23.54), we can say WMG is valued slightly cheaper.
Industry RankSector Rank
PE 49.14
Fwd PE 16.51
WMG Price Earnings VS Forward Price EarningsWMG Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, WMG is valued a bit cheaper than 79.75% of the companies in the same industry.
  • WMG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. WMG is cheaper than 72.15% of the companies in the same industry.
Industry RankSector Rank
P/FCF 32.44
EV/EBITDA 13.22
WMG Per share dataWMG EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10

4.3 Compensation for Growth

  • WMG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • WMG has an outstanding profitability rating, which may justify a higher PE ratio.
  • A more expensive valuation may be justified as WMG's earnings are expected to grow with 40.46% in the coming years.
PEG (NY)0.53
PEG (5Y)N/A
EPS Next 2Y57.05%
EPS Next 3Y40.46%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

5

5. WMG Dividend Analysis

5.1 Amount

  • WMG has a Yearly Dividend Yield of 2.70%. Purely for dividend investing, there may be better candidates out there.
  • WMG's Dividend Yield is rather good when compared to the industry average which is at 9.62. WMG pays more dividend than 96.20% of the companies in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.83, WMG pays a bit more dividend than the S&P500 average.
Industry RankSector Rank
Dividend Yield 2.7%

5.2 History

  • The dividend of WMG has a limited annual growth rate of 1.77%.
  • WMG has been paying a dividend for over 5 years, so it has already some track record.
  • As WMG did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)1.77%
Div Incr Years5
Div Non Decr Years5
WMG Yearly Dividends per shareWMG Yearly Dividends per shareYearly Dividends per share 2020 2021 2022 2023 2024 2025 2026 0.2 0.4 0.6

5.3 Sustainability

  • WMG pays out 130.10% of its income as dividend. This is not a sustainable payout ratio.
  • The dividend of WMG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP130.1%
EPS Next 2Y57.05%
EPS Next 3Y40.46%
WMG Yearly Income VS Free CF VS DividendWMG Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M -200M 400M -400M 600M 800M
WMG Dividend Payout.WMG Dividend Payout, showing the Payout Ratio.WMG Dividend Payout.PayoutRetained Earnings

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WMG Fundamentals: All Metrics, Ratios and Statistics

WARNER MUSIC GROUP CORP-CL A

NASDAQ:WMG (4/10/2026, 8:00:02 PM)

After market: 28.24 -0.26 (-0.91%)

28.5

+0.38 (+1.35%)

Chartmill FA Rating
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)02-05
Earnings (Next)05-07
Inst Owners105.42%
Inst Owner Change0%
Ins Owners0.92%
Ins Owner Change7.11%
Market Cap14.92B
Revenue(TTM)6.88B
Net Income(TTM)299.00M
Analysts81.67
Price Target37.66 (32.14%)
Short Float %6.03%
Short Ratio3.52
Dividend
Industry RankSector Rank
Dividend Yield 2.7%
Yearly Dividend0.74
Dividend Growth(5Y)1.77%
DP130.1%
Div Incr Years5
Div Non Decr Years5
Ex-Date02-18
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-23.57%
Min EPS beat(2)-37.42%
Max EPS beat(2)-9.72%
EPS beat(4)0
Avg EPS beat(4)-58.18%
Min EPS beat(4)-110.91%
Max EPS beat(4)-9.72%
EPS beat(8)3
Avg EPS beat(8)-23.63%
EPS beat(12)5
Avg EPS beat(12)-19.41%
EPS beat(16)7
Avg EPS beat(16)-7.59%
Revenue beat(2)2
Avg Revenue beat(2)6.37%
Min Revenue beat(2)2.74%
Max Revenue beat(2)10.01%
Revenue beat(4)3
Avg Revenue beat(4)3.66%
Min Revenue beat(4)-3.26%
Max Revenue beat(4)10.01%
Revenue beat(8)4
Avg Revenue beat(8)1.72%
Revenue beat(12)7
Avg Revenue beat(12)2.01%
Revenue beat(16)10
Avg Revenue beat(16)1.73%
PT rev (1m)-1.82%
PT rev (3m)-1.91%
EPS NQ rev (1m)0.3%
EPS NQ rev (3m)-3.61%
EPS NY rev (1m)-0.88%
EPS NY rev (3m)-3.68%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)1.06%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)1.58%
Valuation
Industry RankSector Rank
PE 49.14
Fwd PE 16.51
P/S 2.17
P/FCF 32.44
P/OCF 19.46
P/B 20.72
P/tB N/A
EV/EBITDA 13.22
EPS(TTM)0.58
EY2.04%
EPS(NY)1.73
Fwd EY6.06%
FCF(TTM)0.88
FCFY3.08%
OCF(TTM)1.46
OCFY5.14%
SpS13.14
BVpS1.38
TBVpS-8
PEG (NY)0.53
PEG (5Y)N/A
Graham Number4.24
Profitability
Industry RankSector Rank
ROA 2.99%
ROE 41.52%
ROCE 17.79%
ROIC 13.79%
ROICexc 15.88%
ROICexgc 1828.08%
OM 14.74%
PM (TTM) 4.35%
GM 45.87%
FCFM 6.69%
ROA(3y)4.44%
ROA(5y)4.89%
ROE(3y)92.24%
ROE(5y)320.47%
ROIC(3y)13.09%
ROIC(5y)12.66%
ROICexc(3y)14.86%
ROICexc(5y)14.42%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)16.89%
ROCE(5y)16.33%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y-0.38%
ROICexc growth 5YN/A
OM growth 3Y4.68%
OM growth 5YN/A
PM growth 3Y-16.34%
PM growth 5YN/A
GM growth 3Y-1.49%
GM growth 5Y-0.8%
F-Score5
Asset Turnover0.69
Health
Industry RankSector Rank
Debt/Equity 6.07
Debt/FCF 9.5
Debt/EBITDA 3.12
Cap/Depr 78.92%
Cap/Sales 4.46%
Interest Coverage 5.42
Cash Conversion 54.67%
Profit Quality 153.85%
Current Ratio 0.7
Quick Ratio 0.69
Altman-Z 1.65
F-Score5
WACC8.49%
ROIC/WACC1.62
Cap/Depr(3y)84.69%
Cap/Depr(5y)107.57%
Cap/Sales(3y)4.56%
Cap/Sales(5y)6%
Profit Quality(3y)101.59%
Profit Quality(5y)80.52%
High Growth Momentum
Growth
EPS 1Y (TTM)-53.23%
EPS 3Y-12.92%
EPS 5YN/A
EPS Q2Q%-26.67%
EPS Next Y93%
EPS Next 2Y57.05%
EPS Next 3Y40.46%
EPS Next 5Y25.64%
Revenue 1Y (TTM)8.46%
Revenue growth 3Y4.25%
Revenue growth 5Y8.49%
Sales Q2Q%10.44%
Revenue Next Year8.98%
Revenue Next 2Y7.51%
Revenue Next 3Y6.89%
Revenue Next 5Y6.05%
EBIT growth 1Y16.28%
EBIT growth 3Y9.13%
EBIT growth 5YN/A
EBIT Next Year96.34%
EBIT Next 3Y33.18%
EBIT Next 5Y20.75%
FCF growth 1Y-7.26%
FCF growth 3Y-6.41%
FCF growth 5Y0.18%
OCF growth 1Y-0.52%
OCF growth 3Y-3.11%
OCF growth 5Y7.83%

WARNER MUSIC GROUP CORP-CL A / WMG Fundamental Analysis FAQ

What is the fundamental rating for WMG stock?

ChartMill assigns a fundamental rating of 5 / 10 to WMG.


What is the valuation status for WMG stock?

ChartMill assigns a valuation rating of 6 / 10 to WARNER MUSIC GROUP CORP-CL A (WMG). This can be considered as Fairly Valued.


Can you provide the profitability details for WARNER MUSIC GROUP CORP-CL A?

WARNER MUSIC GROUP CORP-CL A (WMG) has a profitability rating of 8 / 10.


What are the PE and PB ratios of WARNER MUSIC GROUP CORP-CL A (WMG) stock?

The Price/Earnings (PE) ratio for WARNER MUSIC GROUP CORP-CL A (WMG) is 49.14 and the Price/Book (PB) ratio is 20.72.


How financially healthy is WARNER MUSIC GROUP CORP-CL A?

The financial health rating of WARNER MUSIC GROUP CORP-CL A (WMG) is 1 / 10.