Tencent Music Entertainment Group

NYSE:TME Stock Report

Market Cap: US$15.3b

Tencent Music Entertainment Group Valuation

Is TME undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

  • Below Future Cash Flow Value

  • Significantly Below Future Cash Flow Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Future Cash Flow Value

What is the Fair Price of TME when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Ultimate guide to DCF valuation for stock investing

Learn how to determine fair value like the best investors in the world.

Below Future Cash Flow Value: TME ($9.73) is trading below our estimate of future cash flow value ($14.49)

Significantly Below Future Cash Flow Value: TME is trading below future cash flow value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TME?

Key metric: As TME is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for TME. This is calculated by dividing TME's market cap by their current earnings.
What is TME's PE Ratio?
PE Ratio9.4x
EarningsCN¥11.06b
Market CapCN¥105.39b

Price to Earnings Ratio vs Peers

How does TME's PE Ratio compare to its peers?

The above table shows the PE ratio for TME vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average81.9x
WMG Warner Music Group
41.3x30.12%US$12.4b
ROKU Roku
158.6x35.78%US$14.1b
FWON.K Formula One Group
35x10.86%US$20.7b
WBD Warner Bros. Discovery
92.8x18.41%US$67.7b
TME Tencent Music Entertainment Group
9.4x6.03%US$15.3b

Price-To-Earnings vs Peers: TME is good value based on its Price-To-Earnings Ratio (9.4x) compared to the peer average (81.9x).

Historical Price to Earnings Ratio

Historical Price to Earnings Ratio compares a stock's price to its earnings over time. Higher ratios indicate that investors are willing to pay more for the stock.

Fetching historical data

Price to Earnings Ratio vs Industry

How does TME's PE Ratio compare vs other companies in the US Entertainment Industry?

6 CompaniesPrice / EarningsEstimated GrowthMarket Cap
SOHU Sohu.com
1.2x-131.52%US$476.24m
DDI DoubleDown Interactive
4.1x3.89%US$414.76m
GDEV GDEV
4.3x-35.33%US$249.29m
RDBX Redbox Entertainment
1.2x-121.78%US$76.65m
TME 9.4xIndustry Avg. 35.0xNo. of Companies6PE020406080100+
6 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: TME is good value based on its Price-To-Earnings Ratio (9.4x) compared to the US Entertainment industry average (35x).

Price to Earnings Ratio vs Fair Ratio

What is TME's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TME PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio9.4x
Fair PE Ratio20.3x

Price-To-Earnings vs Fair Ratio: TME is good value based on its Price-To-Earnings Ratio (9.4x) compared to the estimated Fair Price-To-Earnings Ratio (20.3x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst TME forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$9.73
US$18.50
+90.11%
28.94%US$28.84US$10.69n/a28
Mar ’27US$14.60
US$26.98
+84.77%
9.35%US$30.81US$21.27n/a30
Feb ’27US$16.78
US$26.80
+59.74%
9.36%US$30.61US$21.13n/a30
Jan ’27US$17.53
US$26.83
+53.04%
8.29%US$30.38US$22.00n/a30
Dec ’26US$18.44
US$27.01
+46.48%
8.46%US$33.19US$22.07n/a31
Nov ’26US$22.32
US$28.60
+28.15%
5.77%US$32.97US$24.52n/a31
Oct ’26US$23.12
US$28.74
+24.31%
5.27%US$32.96US$24.72n/a30
Sep ’26US$24.52
US$28.70
+17.04%
5.29%US$32.89US$24.67n/a30
Aug ’26US$20.54
US$19.44
-5.37%
14.67%US$26.12US$14.50n/a30
Jul ’26US$19.24
US$18.94
-1.56%
12.50%US$26.20US$14.57n/a31
Jun ’26US$16.84
US$17.42
+3.44%
8.21%US$20.66US$14.50n/a31
May ’26US$13.37
US$16.47
+23.18%
8.19%US$19.04US$12.92n/a31
Apr ’26US$14.46
US$16.42
+13.56%
8.83%US$19.07US$12.94n/a29
Mar ’26US$12.19
US$14.78
+21.23%
10.33%US$17.88US$11.92US$14.6028
Feb ’26US$11.98
US$14.68
+22.51%
9.53%US$17.38US$11.97US$16.7829
Jan ’26US$11.35
US$14.48
+27.57%
9.03%US$17.01US$11.89US$17.5328
Dec ’25US$11.41
US$14.55
+27.56%
8.82%US$17.15US$11.98US$18.4429
Nov ’25US$11.12
US$14.59
+31.21%
12.89%US$16.97US$7.61US$22.3227
Oct ’25US$12.75
US$14.69
+15.21%
14.37%US$17.52US$7.71US$23.1227
Sep ’25US$10.44
US$14.70
+40.76%
13.01%US$17.19US$7.56US$24.5227
Aug ’25US$13.29
US$16.32
+22.77%
13.73%US$18.99US$8.88US$20.5429
Jul ’25US$14.34
US$16.32
+13.78%
13.73%US$18.91US$8.89US$19.2429
Jun ’25US$14.45
US$16.30
+12.78%
13.80%US$18.97US$8.92US$16.8429
May ’25US$12.39
US$12.92
+4.31%
12.29%US$17.75US$8.92US$13.3730
Apr ’25US$11.12
US$12.39
+11.45%
16.08%US$17.80US$6.13US$14.4630
Mar ’25US$10.39
US$10.07
-3.05%
12.21%US$12.99US$7.95US$12.1929
US$18.5
Fair Value
47.4% undervalued intrinsic discount
28
Number of Analysts

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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Company Analysis and Financial Data Status

DataLast Updated (UTC time)
Company Analysis2026/03/25 00:08
End of Day Share Price 2026/03/25 00:00
Earnings2025/12/31
Annual Earnings2025/12/31

Data Sources

The data used in our company analysis is from S&P Global Market Intelligence LLC. The following data is used in our analysis model to generate this report. Data is normalised which can introduce a delay from the source being available.

PackageDataTimeframeExample US Source *
Company Financials10 years
  • Income statement
  • Cash flow statement
  • Balance sheet
Analyst Consensus Estimates+3 years
  • Forecast financials
  • Analyst price targets
Market Prices30 years
  • Stock prices
  • Dividends, Splits and Actions
Ownership10 years
  • Top shareholders
  • Insider trading
Management10 years
  • Leadership team
  • Board of directors
Key Developments10 years
  • Company announcements

* Example for US securities, for non-US equivalent regulatory forms and sources are used.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more.

Analysis Model and Snowflake

Details of the analysis model used to generate this report is available on our Github page, we also have guides on how to use our reports and tutorials on Youtube.

Learn about the world class team who designed and built the Simply Wall St analysis model.

Industry and Sector Metrics

Our industry and section metrics are calculated every 6 hours by Simply Wall St, details of our process are available on Github.

Analyst Sources

Tencent Music Entertainment Group is covered by 62 analysts. 29 of those analysts submitted the estimates of revenue or earnings used as inputs to our report. Analysts submissions are updated throughout the day.

AnalystInstitution
Jiong ShaoBarclays
Yanfang JiangBenchmark Company
Boris VanBernstein