Warner Music Group Corp. (WMG) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Ennis, Inc.

Warner Music Group Corp.

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Leafly Holdings, Inc.

ARC Document Solutions, Inc.

CompoSecure, Inc.

LiveOne, Inc.

Travelzoo Inc.

Professional Diversity Network, Inc.

Why is Warner Music Group Corp. ?

Positive results in Dec 25

INVENTORY TURNOVER RATIO(HY) Highest at 57.14 times
DIVIDEND PER SHARE(HY) Highest at USD 5.34
RAW MATERIAL COST(Y) Fallen by 0.5% (YoY)

With ROCE of 28.06%, it has a attractive valuation with a 4.10 Enterprise value to Capital Employed

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -26.94%, its profits have fallen by -19.7%

High Institutional Holdings at 100%

These investors have better capability and resources to analyse fundamentals of companies than most retail investors.

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -26.94% returns in the last 1 year, the stock has also underperformed S&P 500 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Warner Music Group Corp. should be less than 10%
Overall Portfolio exposure to Media & Entertainment should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Media & Entertainment)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Warner Music Group Corp. for you?

Medium Risk, Low Return

Absolute

Risk Adjusted

Volatility

Warner Music Group Corp.

-26.94%

-0.74

29.98%

S&P 500

14.9%

0.77

19.29%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

8.66%

EBIT Growth (5y)

52.39%

EBIT to Interest (avg)

5.06

Debt to EBITDA (avg)

4.34

Net Debt to Equity (avg)

6.53

Sales to Capital Employed (avg)

1.37

Tax Ratio

24.47%

Dividend Payout Ratio

105.25%

Pledged Shares

Institutional Holding

100.00%

ROCE (avg)

18.45%

ROE (avg)

137.82%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

19.86

EV to EBIT

14.60

EV to EBITDA

11.09

EV to Capital Employed

4.10

EV to Sales

2.61

PEG Ratio

Dividend Yield

2.71%

ROCE (Latest)

28.06%

ROE (Latest)

98.89%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Dow Theory

Mildly Bearish

OBV

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

7What is working for the Company

INVENTORY TURNOVER RATIO(HY)

Highest at 57.14 times

DIVIDEND PER SHARE(HY)

Highest at USD 5.34

RAW MATERIAL COST(Y)

Fallen by 0.5% (YoY

DEBT-EQUITY RATIO (HY)

Lowest at 535.42 %

PRE-TAX PROFIT(Q)

At USD 325 MM has Grown at 41.46%

-2What is not working for the Company

ROCE(HY)

Lowest at 47.75%

Here's what is working for Warner Music Group Corp.

Inventory Turnover Ratio

Highest at 57.14 times and Grown

In each half year in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Dividend per share

Highest at USD 5.34 and Grown

In each year in the last five years

MOJO Watch

Company is distributing higher dividend from profits generated

DPS (USD)

Pre-Tax Profit

At USD 325 MM has Grown at 41.46%

over average net sales of the previous four periods of USD 229.75 MM

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (USD MM)

Debt-Equity Ratio

Lowest at 535.42 %

in the last five Semi-Annual periods

MOJO Watch

The company has been reducing its borrowing as compared to equity capital

Debt-Equity Ratio

Raw Material Cost

Fallen by 0.5% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales