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

NASDAQ:WMG • US9345502036

Current stock price

27.32 USD
+0.45 (+1.67%)
At close:
27.32 USD
0 (0%)
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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

  • WMG had positive earnings in the past year.
  • WMG had a positive operating cash flow in the past year.
  • 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

  • WMG has a Return On Assets of 2.99%. This is in the better half of the industry: WMG outperforms 74.68% of its industry peers.
  • WMG has a Return On Equity of 41.52%. This is amongst the best in the industry. WMG outperforms 98.73% of its industry peers.
  • WMG's Return On Invested Capital of 13.79% is amongst the best of the industry. WMG outperforms 93.67% of its industry peers.
  • Measured over the past 3 years, the Average Return On Invested Capital for WMG is significantly above the industry average of 7.34%.
  • The 3 year average ROIC (13.09%) for WMG is below the current ROIC(13.79%), indicating increased profibility in the last year.
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 73.42% of its industry peers.
  • WMG's Profit Margin has declined in the last couple of years.
  • WMG has a better Operating Margin (14.74%) than 88.61% of its industry peers.
  • WMG's Operating Margin has improved in the last couple of years.
  • With a Gross Margin value of 45.87%, WMG perfoms like the industry average, outperforming 54.43% of the companies in the same 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.
  • WMG has more shares outstanding than it did 1 year ago.
  • WMG has more shares outstanding than it did 5 years ago.
  • The debt/assets ratio for WMG is higher compared to a year ago.
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

  • WMG has an Altman-Z score of 1.61. This is a bad value and indicates that WMG is not financially healthy and even has some risk of bankruptcy.
  • WMG's Altman-Z score of 1.61 is fine compared to the rest of the industry. WMG outperforms 62.03% 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.
  • WMG has a Debt/Equity ratio of 6.07. This is a high value indicating a heavy dependency on external financing.
  • Looking at the Debt to Equity ratio, with a value of 6.07, WMG is doing worse than 78.48% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 6.07
Debt/FCF 9.5
Altman-Z 1.61
ROIC/WACC1.42
WACC9.7%
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.
  • Looking at the Current ratio, with a value of 0.70, WMG is doing worse than 69.62% of the companies in the same industry.
  • 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: 69.62% 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.
  • 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.
  • WMG shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.46%.
  • 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)-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

  • Based on estimates for the next years, WMG will show a very strong growth in Earnings Per Share. The EPS will grow by 25.64% on average per year.
  • WMG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.05% yearly.
EPS Next Y94.72%
EPS Next 2Y57.8%
EPS Next 3Y41.06%
EPS Next 5Y25.64%
Revenue Next Year8.97%
Revenue Next 2Y7.47%
Revenue Next 3Y6.88%
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 47.10, the valuation of WMG can be described as expensive.
  • Compared to the rest of the industry, the Price/Earnings ratio of WMG indicates a somewhat cheap valuation: WMG is cheaper than 72.15% of the companies listed in the same industry.
  • The average S&P500 Price/Earnings ratio is at 25.70. WMG is valued rather expensively when compared to this.
  • With a Price/Forward Earnings ratio of 15.67, WMG is valued correctly.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of WMG indicates a rather cheap valuation: WMG is cheaper than 83.54% of the companies listed in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 23.84, WMG is valued a bit cheaper.
Industry RankSector Rank
PE 47.1
Fwd PE 15.67
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 78.48% of the companies in the same industry.
  • Based on the Price/Free Cash Flow ratio, WMG is valued a bit cheaper than 75.95% of the companies in the same industry.
Industry RankSector Rank
P/FCF 31.02
EV/EBITDA 12.75
WMG Per share dataWMG EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10

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.
  • The excellent profitability rating of WMG may justify a higher PE ratio.
  • WMG's earnings are expected to grow with 41.06% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.5
PEG (5Y)N/A
EPS Next 2Y57.8%
EPS Next 3Y41.06%

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5

5. WMG Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 2.54%, WMG has a reasonable but not impressive dividend return.
  • Compared to an average industry Dividend Yield of 7.64, WMG pays a better dividend. On top of this WMG pays more dividend than 93.67% of the companies listed in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.89, WMG pays a bit more dividend than the S&P500 average.
Industry RankSector Rank
Dividend Yield 2.54%

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
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 2Y57.8%
EPS Next 3Y41.06%
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 (3/13/2026, 8:03:30 PM)

After market: 27.32 0 (0%)

27.32

+0.45 (+1.67%)

Chartmill FA Rating
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)02-05
Earnings (Next)05-06
Inst Owners106.01%
Inst Owner Change-0.66%
Ins Owners0.9%
Ins Owner Change7.11%
Market Cap14.27B
Revenue(TTM)6.88B
Net Income(TTM)299.00M
Analysts81.67
Price Target38.35 (40.37%)
Short Float %5.32%
Short Ratio3.21
Dividend
Industry RankSector Rank
Dividend Yield 2.54%
Yearly Dividend0.74
Dividend Growth(5Y)1.77%
DP130.1%
Div Incr Years4
Div Non Decr Years4
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)0.14%
PT rev (3m)-1.11%
EPS NQ rev (1m)-2.71%
EPS NQ rev (3m)-3.9%
EPS NY rev (1m)-2.06%
EPS NY rev (3m)-2.91%
Revenue NQ rev (1m)0.37%
Revenue NQ rev (3m)1%
Revenue NY rev (1m)1.37%
Revenue NY rev (3m)1.57%
Valuation
Industry RankSector Rank
PE 47.1
Fwd PE 15.67
P/S 2.07
P/FCF 31.02
P/OCF 18.61
P/B 19.82
P/tB N/A
EV/EBITDA 12.75
EPS(TTM)0.58
EY2.12%
EPS(NY)1.74
Fwd EY6.38%
FCF(TTM)0.88
FCFY3.22%
OCF(TTM)1.47
OCFY5.37%
SpS13.17
BVpS1.38
TBVpS-8.02
PEG (NY)0.5
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 1.61
F-Score5
WACC9.7%
ROIC/WACC1.42
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 Y94.72%
EPS Next 2Y57.8%
EPS Next 3Y41.06%
EPS Next 5Y25.64%
Revenue 1Y (TTM)8.46%
Revenue growth 3Y4.25%
Revenue growth 5Y8.49%
Sales Q2Q%10.44%
Revenue Next Year8.97%
Revenue Next 2Y7.47%
Revenue Next 3Y6.88%
Revenue Next 5Y6.05%
EBIT growth 1Y16.28%
EBIT growth 3Y9.13%
EBIT growth 5YN/A
EBIT Next Year96.34%
EBIT Next 3Y33.38%
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 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 8 / 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 94.72% 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 130.1%.