29.86 USD
-0.04 (-0.13%)
29.66 USD
-0.2 (-0.67%)
We assign a fundamental rating of 4 out of 10 to WMG. WMG was compared to 80 industry peers in the Entertainment industry. WMG scores excellent on profitability, but there are concerns on its financial health. WMG has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year WMG was profitable.
- In the past year WMG had a positive cash flow from operations.
- WMG had positive earnings in each of the past 5 years.
- In the past 5 years WMG always reported a positive cash flow from operatings.
1.2 Ratios
- WMG has a better Return On Assets (3.64%) than 78.75% of its industry peers.
- With an excellent Return On Equity value of 55.33%, WMG belongs to the best of the industry, outperforming 97.50% of the companies in the same industry.
- WMG has a better Return On Invested Capital (12.78%) than 91.25% of its industry peers.
- WMG had an Average Return On Invested Capital over the past 3 years of 13.09%. This is above the industry average of 8.70%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.64% | ||
| ROE | 55.33% | ||
| ROIC | 12.78% |
ROA(3y)4.44%
ROA(5y)4.89%
ROE(3y)92.24%
ROE(5y)320.47%
ROIC(3y)13.09%
ROIC(5y)12.66%
1.3 Margins
- WMG's Profit Margin of 5.34% is fine compared to the rest of the industry. WMG outperforms 73.75% of its industry peers.
- WMG's Profit Margin has declined in the last couple of years.
- WMG has a Operating Margin of 13.84%. This is amongst the best in the industry. WMG outperforms 81.25% of its industry peers.
- WMG's Operating Margin has improved in the last couple of years.
- The Gross Margin of WMG (45.85%) 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 Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.84% | ||
| PM (TTM) | 5.34% | ||
| GM | 45.85% |
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%
2. Health
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
- WMG has a worse debt/assets ratio than last year.
2.2 Solvency
- WMG has an Altman-Z score of 1.65. This is a bad value and indicates that WMG is not financially healthy and even has some risk of bankruptcy.
- With a Altman-Z score value of 1.65, WMG perfoms like the industry average, outperforming 60.00% of the companies in the same industry.
- The Debt to FCF ratio of WMG is 12.80, which is on the high side as it means it would take WMG, 12.80 years of fcf income to pay off all of its debts.
- WMG has a Debt to FCF ratio of 12.80. This is in the better half of the industry: WMG outperforms 61.25% of its industry peers.
- A Debt/Equity ratio of 6.75 is on the high side and indicates that WMG has dependencies on debt financing.
- The Debt to Equity ratio of WMG (6.75) is worse than 78.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.75 | ||
| Debt/FCF | 12.8 | ||
| Altman-Z | 1.65 |
ROIC/WACC1.27
WACC10.06%
2.3 Liquidity
- A Current Ratio of 0.66 indicates that WMG may have some problems paying its short term obligations.
- WMG has a Current ratio of 0.66. This is in the lower half of the industry: WMG underperforms 71.25% of its industry peers.
- A Quick Ratio of 0.64 indicates that WMG may have some problems paying its short term obligations.
- WMG has a Quick ratio of 0.64. This is in the lower half of the industry: WMG underperforms 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.66 | ||
| Quick Ratio | 0.64 |
3. Growth
3.1 Past
- The earnings per share for WMG have decreased strongly by -37.50% in the last year.
- Measured over the past years, WMG shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -12.92% on average per year.
- The Revenue has been growing slightly by 4.37% in the past year.
- Measured over the past years, WMG shows a quite strong growth in Revenue. The Revenue has been growing by 8.49% on average per year.
EPS 1Y (TTM)-37.5%
EPS 3Y-12.92%
EPS 5YN/A
EPS Q2Q%162.5%
Revenue 1Y (TTM)4.37%
Revenue growth 3Y4.25%
Revenue growth 5Y8.49%
Sales Q2Q%14.6%
3.2 Future
- The Earnings Per Share is expected to grow by 25.18% on average over the next years. This is a very strong growth
- WMG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.95% yearly.
EPS Next Y100.37%
EPS Next 2Y56.74%
EPS Next 3Y39.53%
EPS Next 5Y25.18%
Revenue Next Year7.15%
Revenue Next 2Y6.47%
Revenue Next 3Y6.13%
Revenue Next 5Y5.95%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- 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.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 42.66 indicates a quite expensive valuation of WMG.
- 75.00% of the companies in the same industry are more expensive than WMG, based on the Price/Earnings ratio.
- The average S&P500 Price/Earnings ratio is at 27.32. WMG is valued rather expensively when compared to this.
- The Price/Forward Earnings ratio is 21.29, which indicates a rather expensive current valuation of WMG.
- WMG's Price/Forward Earnings ratio is rather cheap when compared to the industry. WMG is cheaper than 82.50% of the companies in the same industry.
- WMG's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42.66 | ||
| Fwd PE | 21.29 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, WMG is valued a bit cheaper than the industry average as 68.75% of the companies are valued more expensively.
- Based on the Price/Free Cash Flow ratio, WMG is valued a bit cheaper than 67.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 45.74 | ||
| EV/EBITDA | 14.92 |
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 a very decent profitability rating, which may justify a higher PE ratio.
- WMG's earnings are expected to grow with 39.53% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.43
PEG (5Y)N/A
EPS Next 2Y56.74%
EPS Next 3Y39.53%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.41%, WMG has a reasonable but not impressive dividend return.
- WMG's Dividend Yield is rather good when compared to the industry average which is at 7.66. WMG pays more dividend than 92.50% of the companies in the same industry.
- WMG's Dividend Yield is a higher than the S&P500 average which is at 1.86.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
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.
- WMG has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)1.77%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
- 106.98% of the earnings are spent on dividend by WMG. This is not a sustainable payout ratio.
- WMG's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP106.98%
EPS Next 2Y56.74%
EPS Next 3Y39.53%
29.86
-0.04 (-0.13%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)11-20 2025-11-20/bmo
Earnings (Next)02-05 2026-02-05/bmo
Inst Owners109.12%
Inst Owner Change-0.72%
Ins Owners1.42%
Ins Owner Change6.71%
Market Cap15.60B
Revenue(TTM)6.71B
Net Income(TTM)358.00M
Analysts80.87
Price Target38.39 (28.57%)
Short Float %3.65%
Short Ratio2.37
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
Yearly Dividend0.74
Dividend Growth(5Y)1.77%
DP106.98%
Div Incr Years4
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-74.17%
Min EPS beat(2)-110.91%
Max EPS beat(2)-37.42%
EPS beat(4)1
Avg EPS beat(4)-47.97%
Min EPS beat(4)-110.91%
Max EPS beat(4)31.13%
EPS beat(8)3
Avg EPS beat(8)-25.48%
EPS beat(12)5
Avg EPS beat(12)-19.63%
EPS beat(16)8
Avg EPS beat(16)-5.32%
Revenue beat(2)2
Avg Revenue beat(2)7.59%
Min Revenue beat(2)5.17%
Max Revenue beat(2)10.01%
Revenue beat(4)2
Avg Revenue beat(4)2.85%
Min Revenue beat(4)-3.26%
Max Revenue beat(4)10.01%
Revenue beat(8)4
Avg Revenue beat(8)1.82%
Revenue beat(12)6
Avg Revenue beat(12)1.59%
Revenue beat(16)10
Avg Revenue beat(16)2%
PT rev (1m)-1.02%
PT rev (3m)3.61%
EPS NQ rev (1m)0.23%
EPS NQ rev (3m)-1.78%
EPS NY rev (1m)-0.09%
EPS NY rev (3m)0.62%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.42%
Revenue NY rev (1m)-0.13%
Revenue NY rev (3m)1.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42.66 | ||
| Fwd PE | 21.29 | ||
| P/S | 2.33 | ||
| P/FCF | 45.74 | ||
| P/OCF | 23.11 | ||
| P/B | 24.11 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.92 |
EPS(TTM)0.7
EY2.34%
EPS(NY)1.4
Fwd EY4.7%
FCF(TTM)0.65
FCFY2.19%
OCF(TTM)1.29
OCFY4.33%
SpS12.84
BVpS1.24
TBVpS-8.22
PEG (NY)0.43
PEG (5Y)N/A
Graham Number4.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.64% | ||
| ROE | 55.33% | ||
| ROCE | 16.49% | ||
| ROIC | 12.78% | ||
| ROICexc | 14.12% | ||
| ROICexgc | 461.16% | ||
| OM | 13.84% | ||
| PM (TTM) | 5.34% | ||
| GM | 45.85% | ||
| FCFM | 5.08% |
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-Score4
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.75 | ||
| Debt/FCF | 12.8 | ||
| Debt/EBITDA | 3.35 | ||
| Cap/Depr | 88.83% | ||
| Cap/Sales | 4.98% | ||
| Interest Coverage | 5.56 | ||
| Cash Conversion | 51.76% | ||
| Profit Quality | 95.25% | ||
| Current Ratio | 0.66 | ||
| Quick Ratio | 0.64 | ||
| Altman-Z | 1.65 |
F-Score4
WACC10.06%
ROIC/WACC1.27
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)-37.5%
EPS 3Y-12.92%
EPS 5YN/A
EPS Q2Q%162.5%
EPS Next Y100.37%
EPS Next 2Y56.74%
EPS Next 3Y39.53%
EPS Next 5Y25.18%
Revenue 1Y (TTM)4.37%
Revenue growth 3Y4.25%
Revenue growth 5Y8.49%
Sales Q2Q%14.6%
Revenue Next Year7.15%
Revenue Next 2Y6.47%
Revenue Next 3Y6.13%
Revenue Next 5Y5.95%
EBIT growth 1Y-4.13%
EBIT growth 3Y9.13%
EBIT growth 5YN/A
EBIT Next Year91.5%
EBIT Next 3Y32.51%
EBIT Next 5Y20.4%
FCF growth 1Y-24.39%
FCF growth 3Y-6.41%
FCF growth 5Y0.18%
OCF growth 1Y-10.48%
OCF growth 3Y-3.11%
OCF growth 5Y7.83%
WARNER MUSIC GROUP CORP-CL A / WMG FAQ
What is the fundamental rating for WMG stock?
ChartMill assigns a fundamental rating of 4 / 10 to WMG.
What is the valuation status of WARNER MUSIC GROUP CORP-CL A (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.
What is the profitability of WMG stock?
WARNER MUSIC GROUP CORP-CL A (WMG) has a profitability rating of 7 / 10.
What is the earnings growth outlook for WARNER MUSIC GROUP CORP-CL A?
The Earnings per Share (EPS) of WARNER MUSIC GROUP CORP-CL A (WMG) is expected to grow by 100.37% in the next year.
How sustainable is the dividend of WARNER MUSIC GROUP CORP-CL A (WMG) stock?
The dividend rating of WARNER MUSIC GROUP CORP-CL A (WMG) is 5 / 10 and the dividend payout ratio is 106.98%.