TME Stock Analysis: Tencent Music Entertainment | NYSE
Internet Content & Information | NYSE, USA | Market Cap: 12.614m USD | 12M Return: -64.8% | US88034P1093 | Charts, Fundamentals & Technical Analysis
Avg Turnover: 51.2M
EPS Trend: 88.4%
Qual. Beats: 0
Rev. Trend: 92.0%
Qual. Beats: 0
Warnings
Tailwinds
No distinct edge detected
Seasonality 7.8 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 leading online music entertainment platform in China, operating flagship streaming services QQ Music, Kugou Music, and Kuwo Music. The company offers a diversified portfolio that includes music streaming, online karaoke through WeSing, music-centric live streaming, long-form audio content (audiobooks, podcasts, talk shows), and short-form video content. Beyond its core platforms, TME generates revenue through music subscriptions, advertising, content licensing, digital album sales, live performances and concerts, artist management, and branded merchandise. Headquartered in Shenzhen, the company operates as a subsidiary of Tencent Holdings Limited, Chinas largest social media and entertainment conglomerate.
The Chinese digital music industry has shifted toward a freemium model, where users access basic services for free with advertising while paying for premium features such as ad-free listening, higher audio quality, and offline playback. TMEs integration of streaming, karaoke, and live broadcasting within a single ecosystem reflects the broader trend of social entertainment convergence in Asian markets, where user engagement and community-driven features play a central role in monetization alongside traditional subscription revenue.
- Online music subscription revenue surges on paid user growth
- Social entertainment services revenue declines as live streaming weakens
- NetEase Cloud Music competition pressures market share and pricing
| Net Income: 8.60b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.09 > 0.02 and ΔFCF/TA 0.46 > 1.0 |
| NWC/Revenue: 51.36% < 20% (prev 47.51%; Δ 3.85% < -1%) |
| CFO/TA 0.10 > 3% & CFO 11.2b > Net Income 8.60b |
| Net Debt (-13.4b) to EBITDA (14.9b): -0.90 < 3 |
| Current Ratio: 1.74 > 1.5 & < 3 |
| Outstanding Shares: last quarter (1.56b) vs 12m ago 0.27% < -2% |
| Gross Margin: 56.76% > 18% (prev 43.72%; Δ 13.04% > 0.5%) |
| Asset Turnover: 29.35% > 50% (prev 28.06%; Δ 1.28% > 0%) |
| Interest Coverage Ratio: 94.72 > 6 (EBIT TTM 13.2b / Interest Expense TTM 139.2m) |
| A: 0.14 (Total Current Assets 39.7b - Total Current Liabilities 22.7b) / Total Assets 117b |
| B: 0.27 (Retained Earnings 31.1b / Total Assets 117b) |
| C: 0.12 (EBIT TTM 13.2b / Avg Total Assets 112b) |
| D: 2.18 (Book Value of Equity 78.3b / Total Liabilities 35.9b) |
| Altman-Z'' = 4.90 = AA |
| DSRI: 1.03 (Receivables 4.18b/3.73b, Revenue 33.0b/30.3b) |
| GMI: 0.77 (GM 43.72% / 56.76%) |
| AQI: 0.92 (AQ_t 0.64 / AQ_t-1 0.70) |
| SGI: 1.09 (Revenue 33.0b / 30.3b) |
| TATA: -0.02 (NI 8.60b - CFO 11.2b) / TA 117b) |
| Beneish M = -3.20 (Cap -4..+1) = AA |
As of October 09, 2026, the stock is trading at USD 7.96 with a total of 2,849,247 shares traded. Over the past week, the price has changed by +2.45%, over one month by -1.24%, over three months by -9.75% and over the past year by -64.83%.
Current recommended Stop Loss: 7.70 (which is 3.3% or 1.2 ATR below the current price).
Tencent Music Entertainment has received a consensus analysts rating of 4.10. Therefore, it is recommended to buy TME.
- StrongBuy: 15
- Buy: 2
- Hold: 12
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 12.6 | 58.3% |
Market Cap CNY = 84.6b (12.6b USD * 6.70455 USD.CNY)
P/E Trailing = 9.1059
P/E Forward = 7.6923
P/S = 0.3718
P/B = 1.0859
P/EG = 1.8755
Revenue TTM = 33.0b CNY
EBIT TTM = 13.2b CNY
EBITDA TTM = 14.9b CNY
Long Term Debt = 10.5b CNY (from longTermDebt, last quarter)
Short Term Debt = 6.13b CNY (from shortTermDebt, last quarter)
Debt = 17.2b CNY (from shortLongTermDebtTotal, last quarter) + Leases 355.0m
Net Debt = -13.4b CNY (calculated: Debt 17.2b - CCE 30.7b)
Enterprise Value = 71.2b CNY (84.6b + Debt 17.2b - CCE 30.7b)
Interest Coverage Ratio = 94.72 (Ebit TTM 13.2b / Interest Expense TTM 139.2m)
EV/FCF = 7.06x (Enterprise Value 71.2b / FCF TTM 10.1b)
FCF Yield = 14.17% (FCF TTM 10.1b / Enterprise Value 71.2b)
FCF Margin = 30.56% (FCF TTM 10.1b / Revenue TTM 33.0b)
Net Margin = 26.08% (Net Income TTM 8.60b / Revenue TTM 33.0b)
Gross Margin = 56.76% ((Revenue TTM 33.0b - Cost of Revenue TTM 14.3b) / Revenue TTM)
Gross Margin QoQ = 44.21% (prev 44.91%)
Tobins Q-Ratio = 0.61 (Enterprise Value 71.2b / Total Assets 117b)
Interest Expense / Debt = 0.81% (Interest Expense 139.2m / Debt 17.2b)
Taxrate = 17.49% (1.88b / 10.7b)
NOPAT = 10.9b (EBIT 13.2b * (1 - 17.49%))
Current Ratio = 1.74 (Total Current Assets 39.7b / Total Current Liabilities 22.7b)
Debt / Equity = 0.22 (Debt 17.2b / totalStockholderEquity, last quarter 78.3b)
Debt / EBITDA = -0.90 (Net Debt -13.4b / EBITDA 14.9b)
Debt / FCF = -1.33 (Net Debt -13.4b / FCF TTM 10.1b)
Total Stockholder Equity = 78.9b (last 4 quarters mean from totalStockholderEquity)
RoA = 7.65% (Net Income 8.60b / Total Assets 117b)
RoE = 10.91% (Net Income TTM 8.60b / Total Stockholder Equity 78.9b)
RoCE = 14.75% (EBIT 13.2b / Capital Employed (Equity 78.9b + L.T.Debt 10.5b))
RoIC = 11.02% (NOPAT 10.9b / Invested Capital 98.7b)
WACC = 8.77% (E(84.6b)/V(102b) * Re(10.42%) + D(17.2b)/V(102b) * Rd(0.81%) * (1-Tc(0.17)))
Discount Rate = 10.42% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -52.91 | Cagr: -0.17%
[DCF] Terminal Value 76.55% ; FCFF base≈9.57b ; Y1≈10.9b ; Y5≈15.9b
[DCF] Fair Price = 297.1 (EV 223b - Net Debt -13.4b = Equity 237b / Shares 797.3m; r=8.77% [WACC]; 5y FCF grow 14.54% → 2.50% )
EPS Correlation: 88.39 | EPS CAGR: 20.20% | SUE: 0.16 | # QB: 0
Revenue Correlation: 92.01 | Revenue CAGR: 7.51% | SUE: -0.08 | # QB: 0
EPS current Quarter (2026-09-30): EPS=1.50 | Chg30d=+0.00% | Revisions=-67% | Analysts=10
EPS current Year (2026-12-31): EPS=6.25 | Chg30d=+0.00% | Revisions=-76% | GrowthEPS=+1.4% | GrowthRev=+7.5%
EPS next Year (2027-12-31): EPS=6.75 | Chg30d=+0.00% | Revisions=-68% | GrowthEPS=+7.9% | GrowthRev=+8.3%
[Analyst] Revisions Ratio: -80% (up=3, down=40)