28.605 USD
+0.71 (+2.56%)
28.57 USD
-0.04 (-0.12%)
Overall WMG gets a fundamental rating of 4 out of 10. We evaluated WMG against 80 industry peers in the Entertainment industry. WMG scores excellent on profitability, but there are concerns on its financial health. WMG is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
WMG had positive earnings in the past year.
In the past year WMG had a positive cash flow from operations.
WMG had positive earnings in each of the past 5 years.
WMG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.64%, WMG is in the better half of the industry, outperforming 76.25% of the companies in the same industry.
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.
Looking at the Return On Invested Capital, with a value of 12.78%, WMG belongs to the top of the industry, outperforming 88.75% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WMG is above the industry average of 9.33%.
| 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 72.50% of its industry peers.
WMG's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 13.84%, WMG belongs to the best of the industry, outperforming 81.25% of the companies in the same industry.
In the last couple of years the Operating Margin of WMG has grown nicely.
With a Gross Margin value of 45.85%, WMG perfoms like the industry average, outperforming 55.00% of the companies in the same industry.
WMG's Gross Margin has been stable in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), WMG is creating some value.
Compared to 1 year ago, WMG has more shares outstanding
WMG has more shares outstanding than it did 5 years ago.
WMG has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.58, we must say that WMG is in the distress zone and has some risk of bankruptcy.
WMG has a Altman-Z score (1.58) which is in line with its industry peers.
WMG has a debt to FCF ratio of 12.80. This is a negative value and a sign of low solvency as WMG would need 12.80 years to pay back of all of its debts.
WMG has a Debt to FCF ratio (12.80) which is in line with its industry peers.
A Debt/Equity ratio of 6.75 is on the high side and indicates that WMG has dependencies on debt financing.
With a Debt to Equity ratio value of 6.75, WMG is not doing good in the industry: 78.75% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.75 | ||
| Debt/FCF | 12.8 | ||
| Altman-Z | 1.58 |
ROIC/WACC1.63
WACC7.82%
2.3 Liquidity
A Current Ratio of 0.66 indicates that WMG may have some problems paying its short term obligations.
The Current ratio of WMG (0.66) is worse than 73.75% of its industry peers.
WMG has a Quick Ratio of 0.66. 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's Quick ratio of 0.64 is on the low side compared to the rest of the industry. WMG is outperformed by 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.66 | ||
| Quick Ratio | 0.64 |
3. Growth
3.1 Past
WMG shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -37.50%.
WMG shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -12.92% yearly.
Looking at the last year, WMG shows a small growth in Revenue. The Revenue has grown by 4.37% in the last 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
Based on estimates for the next years, WMG will show a very strong growth in Earnings Per Share. The EPS will grow by 25.18% on average per year.
The Revenue is expected to grow by 5.95% on average over the next years.
EPS Next Y94.29%
EPS Next 2Y52.93%
EPS Next 3Y39.1%
EPS Next 5Y25.18%
Revenue Next Year5.72%
Revenue Next 2Y5.73%
Revenue Next 3Y6.18%
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
WMG is valuated quite expensively with a Price/Earnings ratio of 40.86.
Compared to the rest of the industry, the Price/Earnings ratio of WMG indicates a somewhat cheap valuation: WMG is cheaper than 75.00% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.46. WMG is valued rather expensively when compared to this.
WMG is valuated rather expensively with a Price/Forward Earnings ratio of 21.03.
83.75% of the companies in the same industry are more expensive than WMG, based on the Price/Forward Earnings ratio.
WMG is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 36.10, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 40.86 | ||
| Fwd PE | 21.03 |
4.2 Price Multiples
WMG's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. WMG is cheaper than 70.00% 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 67.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.82 | ||
| EV/EBITDA | 14.11 |
4.3 Compensation for Growth
The 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 39.10% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.43
PEG (5Y)N/A
EPS Next 2Y52.93%
EPS Next 3Y39.1%
5. Dividend
5.1 Amount
WMG has a Yearly Dividend Yield of 2.39%. 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 34.07. WMG pays more dividend than 92.50% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.32, WMG has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.39% |
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.
The dividend of WMG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP106.98%
EPS Next 2Y52.93%
EPS Next 3Y39.1%
28.605
+0.71 (+2.56%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners108.84%
Inst Owner Change3.94%
Ins Owners1.35%
Ins Owner Change0.83%
Market Cap14.94B
Revenue(TTM)6.71B
Net Income(TTM)358.00M
Analysts80.83
Price Target38.79 (35.61%)
Short Float %4.03%
Short Ratio2.98
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.39% |
Yearly Dividend0.74
Dividend Growth(5Y)1.77%
DP106.98%
Div Incr Years4
Div Non Decr Years4
Ex-Date
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)3.36%
PT rev (3m)3.63%
EPS NQ rev (1m)-1.11%
EPS NQ rev (3m)-1.42%
EPS NY rev (1m)-1.14%
EPS NY rev (3m)-3.44%
Revenue NQ rev (1m)0.85%
Revenue NQ rev (3m)0.68%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 40.86 | ||
| Fwd PE | 21.03 | ||
| P/S | 2.23 | ||
| P/FCF | 43.82 | ||
| P/OCF | 22.14 | ||
| P/B | 23.1 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.11 |
EPS(TTM)0.7
EY2.45%
EPS(NY)1.36
Fwd EY4.75%
FCF(TTM)0.65
FCFY2.28%
OCF(TTM)1.29
OCFY4.52%
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 | 1.58 |
F-Score4
WACC7.82%
ROIC/WACC1.63
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 Y94.29%
EPS Next 2Y52.93%
EPS Next 3Y39.1%
EPS Next 5Y25.18%
Revenue 1Y (TTM)4.37%
Revenue growth 3Y4.25%
Revenue growth 5Y8.49%
Sales Q2Q%14.6%
Revenue Next Year5.72%
Revenue Next 2Y5.73%
Revenue Next 3Y6.18%
Revenue Next 5Y5.95%
EBIT growth 1Y-4.13%
EBIT growth 3Y9.13%
EBIT growth 5YN/A
EBIT Next Year83.17%
EBIT Next 3Y30.76%
EBIT Next 5Y19.73%
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.
Can you provide the valuation status for WARNER MUSIC GROUP CORP-CL A?
ChartMill assigns a valuation rating of 6 / 10 to WARNER MUSIC GROUP CORP-CL A (WMG). This can be considered as Fairly Valued.
How profitable is WARNER MUSIC GROUP CORP-CL A (WMG) stock?
WARNER MUSIC GROUP CORP-CL A (WMG) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for WMG stock?
The Price/Earnings (PE) ratio for WARNER MUSIC GROUP CORP-CL A (WMG) is 40.86 and the Price/Book (PB) ratio is 23.1.
Can you provide the expected EPS growth for WMG stock?
The Earnings per Share (EPS) of WARNER MUSIC GROUP CORP-CL A (WMG) is expected to grow by 94.29% in the next year.