TME Stock Analysis: Tencent Music Entertainment | NYSE
Internet Content & Information | NYSE, USA | Market Cap: 14.506m USD | 12M Return: -55.7% | Charts, Fundamentals & Technical Analysis
Avg Turnover: 47.8M
EPS Trend: 99.1%
Qual. Beats: 0
Rev. Trend: 80.0%
Qual. Beats: 0
Warnings
Tailwinds
No distinct edge detected
Seasonality 7.5 years of data
How good or bad each month usually is (without trend). The score below shows how much you can trust it: 0 = pure chance, >40 gets interesting and >55 is strong.
Tencent Music Entertainment Group (NYSE: TME) is a China-based online music entertainment company headquartered in Shenzhen and operating as a subsidiary of Tencent Holdings Limited. The company runs three flagship music streaming platforms-QQ Music, Kugou Music, and Kuwo Music-through which users can discover, stream, and share music, as well as access long-form audio content such as audiobooks, podcasts, and talk shows, alongside music-oriented video content.
Beyond streaming, TME operates a portfolio of social entertainment services, including WeSing (an online karaoke platform), dedicated live streaming services on apps such as Kugou Live and Kuwo Live, and Lazy Audio. Revenue diversification comes from artist-related merchandise, digital album sales, content licensing, live performances, artist management, music subscriptions, and advertising across its social entertainment platforms.
As a major player in the Chinese digital entertainment sector, TME benefits from Chinas large internet user base and the typical freemium model used across the industry, where basic access is free and premium features-such as ad-free streaming, higher audio quality, and offline downloads-are offered via paid subscriptions. The GICS classification places the company in the Communication Services sector under the Movies & Entertainment sub-industry.
- Music subscription revenue accelerates as paying users expand
- China regulators tighten live streaming rules and content oversight
- Social entertainment revenue declines under ByteDance competition pressure
| Net Income: 8.54b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.09 > 0.02 and ΔFCF/TA -1.40 > 1.0 |
| NWC/Revenue: 55.32% < 20% (prev 53.63%; Δ 1.70% < -1%) |
| CFO/TA 0.10 > 3% & CFO 9.99b > Net Income 8.54b |
| Net Debt (-21.5b) to EBITDA (14.9b): -1.45 < 3 |
| Current Ratio: 2.09 > 1.5 & < 3 |
| Outstanding Shares: last quarter (1.56b) vs 12m ago 0.59% < -2% |
| Gross Margin: 57.00% > 18% (prev 43.11%; Δ 13.90% > 0.5%) |
| Asset Turnover: 32.90% > 50% (prev 29.56%; Δ 3.34% > 0%) |
| Interest Coverage Ratio: 91.47 > 6 (EBIT TTM 13.4b / Interest Expense TTM 146.2m) |
| A: 0.18 (Total Current Assets 34.5b - Total Current Liabilities 16.6b) / Total Assets 99.5b |
| B: 0.29 (Retained Earnings 28.5b / Total Assets 99.5b) |
| C: 0.14 (EBIT TTM 13.4b / Avg Total Assets 98.8b) |
| D: 3.27 (Book Value of Equity 74.1b / Total Liabilities 22.6b) |
| Altman-Z'' = 6.47 = AAA |
| DSRI: 1.06 (Receivables 3.81b/3.20b, Revenue 32.5b/29.0b) |
| GMI: 0.76 (GM 43.11% / 57.00%) |
| AQI: 1.00 (AQ_t 0.64 / AQ_t-1 0.64) |
| SGI: 1.12 (Revenue 32.5b / 29.0b) |
| TATA: -0.01 (NI 8.54b - CFO 9.99b) / TA 99.5b) |
| Beneish M = -3.11 (Cap -4..+1) = AA |
As of July 28, 2026, the stock is trading at USD 9.33 with a total of 11,607,233 shares traded. Over the past week, the price has changed by +1.74%, over one month by +10.41%, over three months by -0.32% and over the past year by -55.65%.
Current recommended Stop Loss: 8.50 (which is 8.9% or 3 ATR below the current price).
Tencent Music Entertainment has received a consensus analysts rating of 4.56. Therefore, it is recommended to buy TME.
- StrongBuy: 20
- Buy: 10
- Hold: 2
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 15.4 | 65% |
Market Cap CNY = 98.2b (14.5b USD * 6.7722 USD.CNY)
P/E Trailing = 10.5476
P/E Forward = 9.3197
P/S = 0.4338
P/B = 1.3217
P/EG = 1.1725
Revenue TTM = 32.5b CNY
EBIT TTM = 13.4b CNY
EBITDA TTM = 14.9b CNY
Long Term Debt = 4.54b CNY (from longTermDebt, last quarter)
Short Term Debt = 110.6m CNY (from shortTermDebt, last quarter)
Debt = 5.12b CNY (from shortLongTermDebtTotal, last quarter) + Leases 299.0m
Net Debt = -21.5b CNY (calculated: Debt 5.12b - CCE 26.7b)
Enterprise Value = 76.7b CNY (98.2b + Debt 5.12b - CCE 26.7b)
Interest Coverage Ratio = 91.47 (Ebit TTM 13.4b / Interest Expense TTM 146.2m)
EV/FCF = 8.66x (Enterprise Value 76.7b / FCF TTM 8.86b)
FCF Yield = 11.55% (FCF TTM 8.86b / Enterprise Value 76.7b)
FCF Margin = 27.25% (FCF TTM 8.86b / Revenue TTM 32.5b)
Net Margin = 26.29% (Net Income TTM 8.54b / Revenue TTM 32.5b)
Gross Margin = 57.00% ((Revenue TTM 32.5b - Cost of Revenue TTM 14.0b) / Revenue TTM)
Gross Margin QoQ = 44.91% (prev none%)
Tobins Q-Ratio = 0.77 (Enterprise Value 76.7b / Total Assets 99.5b)
Interest Expense / Debt = 2.85% (Interest Expense 146.2m / Debt 5.12b)
Taxrate = 17.63% (1.88b / 10.7b)
NOPAT = 11.0b (EBIT 13.4b * (1 - 17.63%))
Current Ratio = 2.09 (Total Current Assets 34.5b / Total Current Liabilities 16.6b)
Debt / Equity = 0.07 (Debt 5.12b / totalStockholderEquity, last quarter 74.1b)
Debt / EBITDA = -1.45 (Net Debt -21.5b / EBITDA 14.9b)
Debt / FCF = -2.43 (Net Debt -21.5b / FCF TTM 8.86b)
Total Stockholder Equity = 80.3b (last 4 quarters mean from totalStockholderEquity)
RoA = 8.65% (Net Income 8.54b / Total Assets 99.5b)
RoE = 10.64% (Net Income TTM 8.54b / Total Stockholder Equity 80.3b)
RoCE = 15.77% (EBIT 13.4b / Capital Employed (Equity 80.3b + L.T.Debt 4.54b))
RoIC = 13.53% (NOPAT 11.0b / Invested Capital 81.4b)
WACC = 9.30% (E(98.2b)/V(103b) * Re(9.66%) + D(5.12b)/V(103b) * Rd(2.85%) * (1-Tc(0.18)))
Discount Rate = 9.66% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -68.76 | Cagr: -0.48%
[DCF] Terminal Value 70.13% ; FCFF base≈9.36b ; Y1≈8.42b ; Y5≈7.15b
[DCF] Fair Price = 149.2 (EV 98.6b - Net Debt -21.5b = Equity 120b / Shares 804.8m; r=9.30% [WACC]; 5y FCF grow -12.39% → 2.50% )
EPS Correlation: 99.06 | EPS CAGR: 25.05% | SUE: 0.46 | # QB: 0
Revenue Correlation: 80.03 | Revenue CAGR: 5.66% | SUE: -0.02 | # QB: 0
EPS current Quarter (2026-06-30): EPS=1.63 | Chg30d=-0.70% | Revisions=-67% | Analysts=7
EPS next Quarter (2026-09-30): EPS=1.64 | Chg30d=+0.41% | Revisions=-44% | Analysts=6
EPS current Year (2026-12-31): EPS=6.48 | Chg30d=-0.23% | Revisions=-28% | GrowthEPS=+5.0% | GrowthRev=+8.3%
EPS next Year (2027-12-31): EPS=7.17 | Chg30d=-0.19% | Revisions=-42% | GrowthEPS=+10.7% | GrowthRev=+10.3%
[Analyst] Revisions Ratio: -50% (up=10, down=33)