Warner Music Group Corp (WMG) Stock: A Value Analysis

The price-to-earnings ratio for Warner Music Group Corp (NASDAQ: WMG) is 37.76x, which is above its average ratio. Moreover, the 36-month beta value for WMG is 1.45. Analysts have varying opinions on the stock, with 0 analysts rating it as a “buy,” 0 as “overweight,” 0 as “hold,” and 0 as “sell.”

The public float for WMG is 133.14M and currently, short sellers hold a 2.75% of that float. On April 03, 2024, WMG’s average trading volume was 1.31M shares.

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WMG) stock’s latest price update

The stock of Warner Music Group Corp (NASDAQ: WMG) has increased by 2.89 when compared to last closing price of 32.71. Despite this, the company has experienced a 2.70% gain in its stock price over the last five trading sessions. Zacks Investment Research reported 2024-03-18 that Film and television production and distribution companies like WMG, NWSA, LGF.A and IMAX benefit from the higher consumption of digital entertainment and a recovering ad spending environment.

WMG’s Market Performance

Warner Music Group Corp (WMG) has experienced a 2.70% rise in stock performance for the past week, with a -4.98% drop in the past month, and a -6.04% drop in the past quarter. The volatility ratio for the week is 2.11%, and the volatility levels for the past 30 days are at 2.23% for WMG. The simple moving average for the last 20 days is 0.83% for WMG stock, with a simple moving average of 2.85% for the last 200 days.

Analysts’ Opinion of WMG

Many brokerage firms have already submitted their reports for WMG stocks, with Redburn Atlantic repeating the rating for WMG by listing it as a “Neutral.” The predicted price for WMG in the upcoming period, according to Redburn Atlantic is $21 based on the research report published on February 05, 2024 of the current year 2024.

Wells Fargo, on the other hand, stated in their research note that they expect to see WMG reach a price target of $35. The rating they have provided for WMG stocks is “Equal Weight” according to the report published on November 15th, 2023.

UBS gave a rating of “Buy” to WMG, setting the target price at $37 in the report published on October 03rd of the previous year.

WMG Trading at -3.45% from the 50-Day Moving Average

After a stumble in the market that brought WMG to its low price for the period of the last 52 weeks, the company was unable to rebound, for now settling with -11.55% of loss for the given period.

Volatility was left at 2.23%, however, over the last 30 days, the volatility rate increased by 2.11%, as shares sank -5.92% for the moving average over the last 20 days. Over the last 50 days, in opposition, the stock is trading -7.66% lower at present.

During the last 5 trading sessions, WMG rose by +2.26%, which changed the moving average for the period of 200-days by +24.76% in comparison to the 20-day moving average, which settled at $33.27. In addition, Warner Music Group Corp saw -5.97% in overturn over a single year, with a tendency to cut further losses.

Insider Trading

Reports are indicating that there were more than several insider trading activities at WMG starting from Benet Lincoln E, who sale 71,981 shares at the price of $36.12 back on Feb 15 ’24. After this action, Benet Lincoln E now owns 277,360 shares of Warner Music Group Corp, valued at $2,599,954 using the latest closing price.

Lousada Max, the CEO, Recorded Music of Warner Music Group Corp, sale 869,008 shares at $33.36 during a trade that took place back on Dec 05 ’23, which means that Lousada Max is holding 1,883,578 shares at $28,990,107 based on the most recent closing price.

Stock Fundamentals for WMG

Current profitability levels for the company are sitting at:

  • 0.14 for the present operating margin
  • 0.48 for the gross margin

The net margin for Warner Music Group Corp stands at 0.07. The total capital return value is set at 0.17. Equity return is now at value 125.51, with 5.37 for asset returns.

Based on Warner Music Group Corp (WMG), the company’s capital structure generated 0.9 points at debt to capital in total, while cash flow to debt ratio is standing at 0.18. The debt to equity ratio resting at 9.28. The interest coverage ratio of the stock is 5.94.

Currently, EBITDA for the company is 1.08 billion with net debt to EBITDA at 3.04. When we switch over and look at the enterprise to sales, we see a ratio of 3.35. The receivables turnover for the company is 5.27for trailing twelve months and the total asset turnover is 0.7. The liquidity ratio also appears to be rather interesting for investors as it stands at 0.70.

Conclusion

To wrap up, the performance of Warner Music Group Corp (WMG) has been mixed in recent times. The stock has received a mixed of “buy” and “hold” ratings from analysts. It’s important to note that the stock is currently trading at a significant distance from its 50-day moving average and its 52-week high.

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