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Tencent Music (ADR) (TME)

Communications · NYSE · China

$9.24+3.70% today

Fundamentals

Market cap$14.54B
P/E ratio10.6
Dividend yield2.70%
Revenue growth (YoY)+7.3%
Profit margin26.5%
Return on equity11.9%
52-week range$7.94 to $26.70
Next earnings2026-08-11

Valuation and ratings

DCF fair value$3.55
Upside to fair value-61.6%
Analyst target (mean)$15.47
Analyst range$10.04 to $28.31
Analysts covering28
Consensus viewbuy
Moat score67/100
Overall rating46/100, Hold

Tencent Music (ADR) trades at $9.24, which is 62% above the $3.55 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.

Our moat model scores it 67 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.

It changes hands at 10.6 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.

About Tencent Music (ADR)

Tencent Music Entertainment Group operates online music entertainment platforms that provides music streaming, online karaoke, and live streaming services in the People's Republic of China. It provides QQ Music, Kugou Music, and Kuwo Music that enable users to discover, enjoy, and share music in personalized ways; long-form audio content, including audiobooks, podcasts and talk shows, as well as music-oriented video content comprising music videos, live performances, and short videos; and WeSing, which enables users to sing along from its library of karaoke songs and share their performances in audio or video formats with friends. The company also delivers music-centric live streaming services primarily through the Live Streaming tab on QQ Music, Kugou Music, Kuwo Music, WeSing, Kugou Live, and Kuwo Live that provides an interactive online stage for performers and users to showcase their talent and engage with audience base; and Lazy Audio, an audio platform. In addition, it sells artist-related merchandise, such as branded apparel, posters and art prints, and accessories; other music services, such as content licensing, sales of digital albums, sales of customized artist-related merchandises, live performances and concerts, and artist management services; and music subscriptions, as well as offers advertising services across its social entertainment platforms. The company is headquartered in Shenzhen, China. Tencent Music Entertainment Group operates as a subsidiary of Tencent Holdings Limited.

Industry: Internet Content & InformationEmployees: 5,690HQ: China

TME passes 6 of our 30 screens today

Each screen prints the exact criteria it used, and the circumstances in which it is wrong.

Deep value, with a pulse
A very low earnings multiple is usually a warning. This screen demands a low multiple AND evidence the business still works.
Growing dividend payers
A modest yield attached to a growing business beats a large yield attached to a shrinking one, every time, over any horizon that matters.
Fortress balance sheets
Companies that owe almost nothing. They will survive things that kill their competitors, and they can buy the wreckage afterwards.
Low volatility defensives
Companies that move less than the market and pay you to wait. The holdings that let you sleep, and let you hold everything else.
Beaten down, but not broken
Good businesses whose share price has been punished. Sometimes the market is wrong. Sometimes it is early. The screen cannot tell you which.
China and Hong Kong
Enormous growth, and a structure in which you may not legally own the company you think you bought. Both are true at once.

Smart money ownership

12 of the funds we track reported a position in their latest SEC 13F filing. Largest first:

A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.

Common questions

Is Tencent Music (ADR) (TME) undervalued?

Against our discounted cash flow estimate of $3.55, TME at $9.24 is 62% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.

Which funds own TME?

12 of the institutions we track reported a position in TME in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.

What is TME's P/E ratio?

TME trades at 10.6 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.

The full research page for TME, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.

Open TME in the appFree guides and screens

Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.