Warner Music Price To Book vs. Revenue

WMG Stock  USD 31.08  0.08  0.26%   
Based on the measurements of profitability obtained from Warner Music's financial statements, Warner Music Group may not be well positioned to generate adequate gross income at this time. It has a very high probability of underperforming in January. Profitability indicators assess Warner Music's ability to earn profits and add value for shareholders. At this time, Warner Music's Sales General And Administrative To Revenue is most likely to slightly decrease in the upcoming years. The Warner Music's current Price Sales Ratio is estimated to increase to 4.48, while Operating Cash Flow Sales Ratio is projected to decrease to 0.08. At this time, Warner Music's Income Before Tax is most likely to increase significantly in the upcoming years. The Warner Music's current Net Income Applicable To Common Shares is estimated to increase to about 665.3 M, while Income Tax Expense is projected to decrease to roughly 116.8 M.
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.430.4779
Moderately Down
Slightly volatile
For Warner Music profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Warner Music to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Warner Music Group utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Warner Music's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Warner Music Group over time as well as its relative position and ranking within its peers.
  

Warner Music's Revenue Breakdown by Earning Segment

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Is Movies & Entertainment space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Warner Music. If investors know Warner will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Warner Music listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
0.137
Earnings Share
0.83
Revenue Per Share
12.343
Quarterly Revenue Growth
(0.01)
Return On Assets
0.0742
The market value of Warner Music Group is measured differently than its book value, which is the value of Warner that is recorded on the company's balance sheet. Investors also form their own opinion of Warner Music's value that differs from its market value or its book value, called intrinsic value, which is Warner Music's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Warner Music's market value can be influenced by many factors that don't directly affect Warner Music's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Warner Music's value and its price as these two are different measures arrived at by different means. Investors typically determine if Warner Music is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Warner Music's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Warner Music Group Revenue vs. Price To Book Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Warner Music's current stock value. Our valuation model uses many indicators to compare Warner Music value to that of its competitors to determine the firm's financial worth.
Warner Music Group is rated second in price to book category among its peers. It is rated fourth in revenue category among its peers totaling about  206,360,370  of Revenue per Price To Book. At this time, Warner Music's Total Revenue is most likely to increase significantly in the upcoming years. Comparative valuation analysis is a catch-all technique that is used if you cannot value Warner Music by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

Warner Revenue vs. Price To Book

Price to Book (P/B) ratio is used to relate a company book value to its current market price. A high P/B ratio indicates that investors expect executives to generate more returns on their investments from a given set of assets. Book value is the accounting value of assets minus liabilities.

Warner Music

P/B

 = 

MV Per Share

BV Per Share

 = 
31.14 X
Price to Book ratio is mostly used in financial services industries where assets and liabilities are typically represented by dollars. Although low Price to Book ratio generally implies that the firm is undervalued, it is often a good indicator that the company may be in financial or managerial distress and should be investigated more carefully.
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.

Warner Music

Revenue

 = 

Money Received

-

Discounts and Returns

 = 
6.43 B
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Warner Revenue vs Competition

Warner Music Group is rated fourth in revenue category among its peers. Market size based on revenue of Communication Services industry is at this time estimated at about 105.08 Billion. Warner Music holds roughly 6.43 Billion in revenue claiming about 6% of stocks in Communication Services industry.

Warner Music Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Warner Music, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Warner Music will eventually generate negative long term returns. The profitability progress is the general direction of Warner Music's change in net profit over the period of time. It can combine multiple indicators of Warner Music, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-247 M-234.7 M
Operating Income823 M864.1 M
Net Income478 M501.9 M
Income Tax Expense123 M116.8 M
Income Before Tax601 M631 M
Total Other Income Expense Net-222 M-210.9 M
Interest Income127.8 M125.3 M
Net Income Applicable To Common Shares633.6 M665.3 M
Net Interest Income-161 M-169.1 M
Net Income From Continuing Ops478 M251.5 M
Non Operating Income Net Other173.7 M182.3 M
Change To Netincome-70.2 M-66.6 M
Net Loss 0.83 (2.70)
Income Quality 1.58  1.66 
Net Income Per E B T 0.72  0.76 

Warner Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Warner Music. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Warner Music position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Warner Music's important profitability drivers and their relationship over time.

Use Warner Music in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Warner Music position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Warner Music will appreciate offsetting losses from the drop in the long position's value.

Warner Music Pair Trading

Warner Music Group Pair Trading Analysis

The ability to find closely correlated positions to Warner Music could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Warner Music when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Warner Music - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Warner Music Group to buy it.
The correlation of Warner Music is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Warner Music moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Warner Music Group moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Warner Music can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Warner Music position

In addition to having Warner Music in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

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Non-Metallic and Industrial Metal Mining
Non-Metallic and Industrial Metal Mining Theme
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You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Non-Metallic and Industrial Metal Mining Theme or any other thematic opportunities.
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When determining whether Warner Music Group is a strong investment it is important to analyze Warner Music's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Warner Music's future performance. For an informed investment choice regarding Warner Stock, refer to the following important reports:
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You can also try the Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
To fully project Warner Music's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Warner Music Group at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Warner Music's income statement, its balance sheet, and the statement of cash flows.
Potential Warner Music investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Warner Music investors may work on each financial statement separately, they are all related. The changes in Warner Music's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Warner Music's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.