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Warner Music Group Corp
NASDAQ:WMG

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Warner Music Group Corp Logo
Warner Music Group Corp
NASDAQ:WMG
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Price: 34.93 USD 1.42% Market Closed
Updated: Mar 1, 2024

Intrinsic Value

Warner Music Group Corp. engages in the publishing and recording of music. [ Read More ]

The intrinsic value of one WMG stock under the Base Case scenario is 35.86 USD. Compared to the current market price of 34.93 USD, Warner Music Group Corp is Undervalued by 3%.

Key Points:
WMG Intrinsic Value
Base Case
35.86 USD
Undervaluation 3%
Intrinsic Value
Price
Worst Case
Base Case
Best Case

Valuation Backtest
Warner Music Group Corp

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Fundamental Analysis

Warner Music's Q1 Fiscal Growth and Operational Changes
2024-Q1 Earnings Call

Warner Music's Q1 Fiscal Growth and Operational Changes

Warner Music Group reported robust fiscal growth in Q1, with a 16% increase in total revenue and a 33% rise in adjusted OIBDA, yielding a margin of 25.8%, up by 330 basis points from the same quarter last year. The normalized figures also show a healthy uptrend, with an 11% revenue growth and a 10% OIBDA increase, maintaining a steady margin of 22.6%. Streaming remained a primary growth driver with revenues up by 11.4% along with subscription streaming surging by 14%, courtesy of price hikes by Digital Service Providers. Meanwhile, licensing revenue leaped by 81%, largely due to lucrative deals primarily in the US. The company's Music Publishing segment also showed vigorous performance with a 20% revenue growth, supported by a 30% bump in digital revenues. Operational efficiency improvements are expected to save $200 million annually by fiscal 2025, despite an associated pretax charge of roughly $140 million due to the plan.

Financials

Balance Sheet Decomposition
Warner Music Group Corp

Current Assets 2.6B
Cash & Short-Term Investments 754m
Receivables 1.2B
Other Current Assets 667m
Non-Current Assets 6.4B
PP&E 708m
Intangibles 4.6B
Other Non-Current Assets 1.1B
Current Liabilities 3.7B
Accounts Payable 246m
Accrued Liabilities 3.1B
Other Current Liabilities 429m
Non-Current Liabilities 4.8B
Long-Term Debt 4B
Other Non-Current Liabilities 779m
Efficiency
Fundamental Scores

WMG Profitability Score
Profitability Due Diligence

Warner Music Group Corp's profitability score is 63/100. The higher the profitability score, the more profitable the company is.

Exceptional 3-Year Average ROE
Positive Gross Profit
Exceptional ROE
ROIC is Increasing
63/100
Profitability
Score

Warner Music Group Corp's profitability score is 63/100. The higher the profitability score, the more profitable the company is.

WMG Solvency Score
Solvency Due Diligence

Warner Music Group Corp's solvency score is 28/100. The higher the solvency score, the more solvent the company is.

Long-Term Solvency
Short-Term Solvency
Average Altman Z-Score
Positive Net Debt
28/100
Solvency
Score

Warner Music Group Corp's solvency score is 28/100. The higher the solvency score, the more solvent the company is.

Wall St
Price Targets

WMG Price Targets Summary
Warner Music Group Corp

Wall Street analysts forecast WMG stock price to rise over the next 12 months.

According to Wall Street analysts, the average 1-year price target for WMG is 38.38 USD with a low forecast of 21.21 USD and a high forecast of 48.3 USD.

Lowest
Price Target
21.21 USD
39% Downside
Average
Price Target
38.38 USD
10% Upside
Highest
Price Target
48.3 USD
38% Upside
View Analyst Estimates
View Analyst Estimates

Competitive Landscape

Ownership

WMG Insider Trading
Buy and sell transactions by insiders

Cumulative Transactions Amount
Period Sold Bought Net
3 Months
6 Months
9 Months
12 Months
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Shareholder Return

WMG Price
Warner Music Group Corp

1M 1M
-6%
6M 6M
+4%
1Y 1Y
+13%
3Y 3Y
-3%
5Y 5Y
+22%
10Y 10Y
+22%
Annual Price Range
34.93
52w Low
24.23
52w High
37.23
Price Metrics
Average Annual Return 8.54%
Standard Deviation of Annual Returns 21.39%
Max Drawdown -54%
Shares Statistics
Market Capitalization 18.2B USD
Shares Outstanding 517 860 000
Percentage of Shares Shorted 3.23%

WMG Return Decomposition
Main factors of price return

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WMG News

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Last Important Events
Warner Music Group Corp

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Sentiment Analysis
Warner Music Group Corp

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Company Profile

Warner Music Group Corp Logo
Warner Music Group Corp

Country

United States of America

Industry

Media

Market Cap

18.2B USD

Dividend Yield

1.95%

Description

Warner Music Group Corp. engages in the publishing and recording of music. The company is headquartered in New York City, New York and currently employs 5,900 full-time employees. The company went IPO on 2020-06-03. The Company’s segments include Recorded Music and Music Publishing. The Recorded Music segment consists of the discovery and development of recording artists and the related marketing, promotion, distribution, sale, and licensing of music created by such recording artists. In the United States, its Recorded Music business is conducted principally through its record labels, such as Atlantic Records and Warner Records. The company also conducts its Recorded Music business through a collection of additional record labels including Asylum, Big Beat, Canvasback, East West, Erato, FFRR, Nonesuch, Parlophone, Reprise, Sire, Records, Warner Classics and Warner Music Nashville. The Music Publishing segment is focused on marketing, promoting, distributing, and licensing a particular recording of a musical composition. The operations of its Music Publishing business are conducted through Warner Chappell Music, its global music publishing company.

Contact

NEW YORK
New York City
1633 Broadway
+12122752000.0
http://www.wmg.com/

IPO

2020-06-03

Employees

5 900

Officers

President, CEO & Director
Mr. Robert Kyncl
Chief Executive Officer of Warner Recorded Music
Mr. Max Lousada
Co-Chair & CEO of Warner Chappell Music
Mr. Guy Moot
Co-Chair & COO of Warner Chappell Music
Ms. Carianne Marshall
Executive VP & CFO
Mr. Bryan Castellani
Executive Vice President of Strategy & Operations
Mr. Timothy Matusch
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President of Technology
Mr. Ariel Bardin
Senior VP & Head of Investor Relations
Mr. Kareem Chin
Executive VP & General Counsel
Mr. Paul Martin Robinson Esq., J.D.
Senior VP, Deputy General Counsel, Chief Compliance Officer & Secretary
Trent N. Tappe Esq.
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See Also

Discover More
What is the Intrinsic Value of one WMG stock?

The intrinsic value of one WMG stock under the Base Case scenario is 35.86 USD.

Is WMG stock undervalued or overvalued?

Compared to the current market price of 34.93 USD, Warner Music Group Corp is Undervalued by 3%.