Analyze Warner Music Group (WMG) and its peers
Warner Music Group (NASDAQ:WMG – Get Rating) is one of 34 publicly traded companies in the “entertainment and leisure services” sector, but how does it compare to its competitors? We will compare Warner Music Group to similar companies based on the strength of its profitability, analyst recommendations, earnings, valuation, institutional ownership, dividends and risk.
Risk and Volatility
Warner Music Group has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500. Comparatively, Warner Music Group’s competitors have a beta of -0.49, indicating that their average price is 149% less volatile than the S&P 500. S&P 500.
Warner Music Group pays an annual dividend of $0.60 per share and has a dividend yield of 2.1%. Warner Music Group pays 84.5% of its earnings as a dividend, suggesting it may not have enough earnings to cover its dividend payment in the future. As a group, the “amusement and leisure services” companies pay a dividend yield of 1.9% and pay out -573.3% of their earnings as a dividend. Warner Music Group has increased its dividend for 1 consecutive years.
This is a summary of current recommendations and price targets for Warner Music Group and its competitors, as reported by MarketBeat.com.
|Sales Ratings||Hold odds||Buy reviews||Strong buy odds||Rating|
|Warner Music Group||2||2||8||0||2.50|
|Warner Music Group Competitors||73||267||376||ten||2.44|
Warner Music Group currently has a consensus target price of $45.50, suggesting a potential upside of 56.46%. As a group, “amusement and recreation services” companies have an upside potential of 69.14%. Since Warner Music Group’s competitors have higher growth potential, analysts clearly believe that Warner Music Group has less favorable growth aspects than its competitors.
Benefits and evaluation
This table compares the revenue, earnings per share and valuation of Warner Music Group and its competitors.
|Gross revenue||Net revenue||Price/earnings ratio|
|Warner Music Group||$5.30 billion||$304.00 million||40.96|
|Warner Music Group Competitors||$914.79 million||-75.39 million dollars||53.56|
Warner Music Group has higher revenues and profits than its competitors. Warner Music Group trades at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.
This table compares the net margins, return on equity and return on assets of Warner Music Group and its competitors.
|Net margins||Return on equity||return on assets|
|Warner Music Group||6.45%||421.73%||5.93%|
|Warner Music Group Competitors||2290.89%||1.22%||170.83%|
Institutional and Insider Ownership
22.3% of Warner Music Group shares are held by institutional investors. In comparison, 34.0% of the shares of all “Amusement and recreation services” companies are held by institutional investors. 76.6% of Warner Music Group shares are held by insiders of the company. By comparison, 29.4% of the shares of all “amusement and recreation services” companies are held by insiders of the company. Strong institutional ownership is an indication that endowments, large fund managers, and hedge funds believe a company will outperform the market over the long term.
Warner Music Group beats its competitors on 8 of the 15 factors compared.
About Warner Music Group (Get a rating)
Warner Music Group Corp. operates as a music entertainment company in the United States, United Kingdom, Germany and internationally. The Company operates through the Recorded Music and Music Publishing segments. The Recorded Music segment is involved in the discovery and development of recording artists, as well as the related marketing, promotion, distribution, sale and licensing of music created by such recording artists; markets its music catalog through compilations and reissues of previously released music and video titles, as well as unreleased content; and operates primarily through a collection of record labels, such as Warner Records and Atlantic Records, as well as Asylum, Big Beat, Canvasback, East West, Erato, FFRR, Fueled by Ramen, Nonesuch, Parlophone, Reprise, Roadrunner, Sire, Spinnin’ Records, Warner Classics and Warner Music Nashville. This segment markets, distributes and sells music and video products to retailers and wholesale distributors; from independent labels to retail and wholesale distributors; and various distribution centers and businesses, as well as retail outlets, physical online retailers, streaming services, and download services. The Music Publishing segment owns and acquires the rights to approximately one million musical compositions including pop hits, American standards, folk songs, and film and theatrical compositions. Its catalog includes approximately 100,000 songwriters and composers; and various genres including pop, rock, jazz, classical, country, R&B, hip-hop, rap, reggae, Latin, folk, blues, symphonic, soul, Broadway, electronic, alternative, and gospel. This segment also administers music and soundtracks from various third-party television and film producers and studios. The company was founded in 1929 and is headquartered in New York, New York.
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