Is Warner Music Group Corp. overvalued or undervalued?

As of 7 August 2025, the valuation grade for Warner Music Group Corp. has moved from fair to attractive, indicating a positive shift in its market standing. The company appears undervalued based on its current metrics, with a P/E ratio of 19, an EV to EBITDA of 12.53, and a ROE of 129.12%. In comparison, peers such as CompoSecure, Inc. have a P/E of 21.96, while Deluxe Corp. shows a much lower P/E of 9.65, highlighting Warner's relative attractiveness in the market.
Despite recent stock performance lagging behind the S&P 500 over longer periods, with a 3-year return of 25.92% compared to the S&P's 70.41%, the company's strong fundamentals suggest it is well-positioned for future growth. The combination of its attractive valuation ratios and robust return on equity reinforces the view that Warner Music Group Corp. is undervalued in the current market.