Comprehensive Stock Comparison
Compare Warner Music Group Corp. (WMG) vs Warner Bros. Discovery, Inc. (WBD) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | WMG | 4.4% revenue growth vs WBD's -4.8% |
| Value | WBD | Better valuation composite |
| Quality / Margins | WMG | 4.4% net margin vs WBD's 1.3% |
| Stability / Safety | WMG | Beta 0.59 vs WBD's 1.73 |
| Dividends | WMG | 2.6% yield; 4-year raise streak; WBD pays no meaningful dividend |
| Momentum (1Y) | WBD | +145.8% vs WMG's -12.9% |
| Efficiency (ROA) | WMG | 3.0% ROA vs WBD's 0.5%, ROIC 11.4% vs -9.7% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Defensive / Recession hedge
Business Model
What each company does and how it makes money
Warner Music Group is one of the world's three major music companies that discovers, develops, and markets recording artists and their music. It generates revenue primarily from recorded music sales and streaming (about 85% of revenue) and music publishing royalties (about 15%), with income coming from physical sales, digital downloads, streaming platforms, and licensing music for films, TV, and advertising. Its competitive advantage lies in owning a massive, valuable catalog of iconic recordings and publishing rights—including works from artists like Madonna, Bruno Mars, and Ed Sheeran—which provides stable, recurring revenue and significant negotiating power with digital platforms.
Warner Bros. Discovery is a global media and entertainment conglomerate that produces and distributes content across film, television, and streaming platforms. It generates revenue primarily through three segments: Studios (film and TV production), Networks (cable and broadcast channels), and Direct-to-Consumer (streaming services like Max and discovery+). The company's key advantage is its massive content library and iconic franchises — including DC, Harry Potter, HBO originals, and Discovery's unscripted programming — which create a deep moat in an increasingly competitive streaming landscape.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
WMG leads in 3 of 6 categories (Financial Metrics, Profitability & Efficiency). WBD leads in 2 (Valuation Metrics, Total Returns). 1 tied.
Financial Metrics (TTM)
WBD is the larger business by revenue, generating $37.9B annually — 5.5x WMG's $6.9B. Profitability is closely matched — net margins range from 4.4% (WMG) to 1.3% (WBD). On growth, WMG holds the edge at +10.4% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | WMGWarner Music Grou… | WBDWarner Bros. Disc… |
|---|---|---|
| RevenueTrailing 12 months | $6.9B | $37.9B |
| EBITDAEarnings before interest/tax | $1.1B | $16.4B |
| Net IncomeAfter-tax profit | $305M | $485M |
| Free Cash FlowCash after capex | $572M | $4.1B |
| Gross MarginGross profit ÷ Revenue | +45.9% | +44.0% |
| Operating MarginEBIT ÷ Revenue | +11.2% | +1.5% |
| Net MarginNet income ÷ Revenue | +4.4% | +1.3% |
| FCF MarginFCF ÷ Revenue | +8.3% | +10.9% |
| Rev. Growth (YoY)Latest quarter vs prior year | +10.4% | -6.0% |
| EPS Growth (YoY)Latest quarter vs prior year | -24.4% | -2.1% |
Valuation Metrics
On an enterprise value basis, WBD's 10.1x EV/EBITDA is more attractive than WMG's 12.8x.
| Metric | WMGWarner Music Grou… | WBDWarner Bros. Disc… |
|---|---|---|
| Market CapShares × price | $10.7B | $76.3B |
| Enterprise ValueMkt cap + debt − cash | $14.8B | $110.5B |
| Trailing P/EPrice ÷ TTM EPS | 40.86x | -6.10x |
| Forward P/EPrice ÷ next-FY EPS est. | 21.00x | — |
| PEG RatioP/E ÷ EPS growth rate | — | — |
| EV / EBITDAEnterprise value multiple | 12.81x | 10.09x |
| Price / SalesMarket cap ÷ Revenue | 1.60x | 1.94x |
| Price / BookPrice ÷ Book value/share | 19.61x | 1.98x |
| Price / FCFMarket cap ÷ FCF | 19.92x | 17.23x |
Profitability & Efficiency
WMG delivers a 37.0% return on equity — every $100 of shareholder capital generates $37 in annual profit, vs $1 for WBD. WBD carries lower financial leverage with a 1.13x debt-to-equity ratio, signaling a more conservative balance sheet compared to WMG's 6.09x. On the Piotroski fundamental quality scale (0–9), WBD scores 4/9 vs WMG's 3/9, reflecting mixed financial health.
| Metric | WMGWarner Music Grou… | WBDWarner Bros. Disc… |
|---|---|---|
| ROE (TTM)Return on equity | +37.0% | +1.3% |
| ROA (TTM)Return on assets | +3.0% | +0.5% |
| ROICReturn on invested capital | +11.4% | -9.7% |
| ROCEReturn on capital employed | +12.8% | -10.2% |
| Piotroski ScoreFundamental quality 0–9 | 3 | 4 |
| Debt / EquityFinancial leverage | 6.09x | 1.13x |
| Net DebtTotal debt minus cash | $4.1B | $34.2B |
| Cash & Equiv.Liquid assets | $532M | $5.3B |
| Total DebtShort + long-term debt | $4.6B | $39.5B |
| Interest CoverageEBIT ÷ Interest expense | 3.70x | 1.85x |
Total Returns (with DRIP)
A $10,000 investment in WMG five years ago would be worth $8,535 today (with dividends reinvested), compared to $4,842 for WBD. Over the past 12 months, WBD leads with a +145.8% total return vs WMG's -12.9%. The 3-year compound annual growth rate (CAGR) favors WBD at 21.7% vs WMG's -0.9% — a key indicator of consistent wealth creation.
| Metric | WMGWarner Music Grou… | WBDWarner Bros. Disc… |
|---|---|---|
| YTD ReturnYear-to-date | -5.4% | -1.2% |
| 1-Year ReturnPast 12 months | -12.9% | +145.8% |
| 3-Year ReturnCumulative with dividends | -2.6% | +80.3% |
| 5-Year ReturnCumulative with dividends | -14.6% | -51.6% |
| 10-Year ReturnCumulative with dividends | +7.2% | +12.7% |
| CAGR (3Y)Annualised 3-year return | -0.9% | +21.7% |
Risk & Volatility
WMG is the less volatile stock with a 0.59 beta — it tends to amplify market swings less than WBD's 1.73 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. WBD currently trades 93.9% from its 52-week high vs WMG's 81.9% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | WMGWarner Music Grou… | WBDWarner Bros. Disc… |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 0.59x | 1.73x |
| 52-Week HighHighest price in past year | $34.94 | $30.00 |
| 52-Week LowLowest price in past year | $25.56 | $7.52 |
| % of 52W HighCurrent price vs 52-week peak | +81.9% | +93.9% |
| RSI (14)Momentum oscillator 0–100 | 43.0 | 58.5 |
| Avg Volume (50D)Average daily shares traded | 1.9M | 20.9M |
Analyst Outlook
Wall Street rates WMG as "Buy" and WBD as "Hold". Consensus price targets imply 27.6% upside for WMG (target: $37) vs -9.2% for WBD (target: $26). WMG is the only dividend payer here at 2.58% yield — a key consideration for income-focused portfolios.
| Metric | WMGWarner Music Grou… | WBDWarner Bros. Disc… |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Hold |
| Price TargetConsensus 12-month target | $36.50 | $25.59 |
| # AnalystsCovering analysts | 24 | 31 |
| Dividend YieldAnnual dividend ÷ price | +2.6% | — |
| Dividend StreakConsecutive years of raises | 4 | 1 |
| Dividend / ShareAnnual DPS | $0.74 | — |
| Buyback YieldShare repurchases ÷ mkt cap | +0.1% | 0.0% |
Historical Charts
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Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Jun 20 | Feb 26 | Change |
|---|---|---|---|
| Warner Music Group … (WMG) | 100 | 100.27 | +0.3% |
| Warner Bros. Discov… (WBD) | 100 | 130.61 | +30.6% |
Warner Music Group … (WMG) returned -15% over 5 years vs Warner Bros. Discov… (WBD)'s -52%.
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Warner Music Group … (WMG) | $3.2B | $6.7B | +106.6% |
| Warner Bros. Discov… (WBD) | $6.5B | $39.3B | +505.2% |
Warner Music Group Corp.'s revenue grew from $3.2B (2016) to $6.7B (2025) — a 8.4% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Warner Music Group … (WMG) | 0.8% | 5.4% | +606.6% |
| Warner Bros. Discov… (WBD) | 18.4% | -28.8% | -256.5% |
Warner Music Group Corp.'s net margin went from 1% (2016) to 5% (2025).
Chart 4P/E Ratio History — 8 Years
| Stock | 2018 | 2025 | Change |
|---|---|---|---|
| Warner Music Group … (WMG) | 74.4 | 43.8 | -41.1% |
| Warner Bros. Discov… (WBD) | 28.8 | 15.3 | -46.9% |
Warner Music Group Corp. has traded in a 33x–74x P/E range over 5 years; current trailing P/E is ~41x. Warner Bros. Discovery, Inc. has traded in a 11x–29x P/E range over 4 years; current trailing P/E is ~-6x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Warner Music Group … (WMG) | 0.05 | 0.7 | +1305.6% |
| Warner Bros. Discov… (WBD) | 1.96 | -4.62 | -335.7% |
Warner Music Group Corp.'s EPS grew from $0.05 (2016) to $0.70 (2025) — a 34% CAGR.
Chart 6Free Cash Flow — 5 Years
Warner Music Group Corp. generated $539M FCF in 2025 (+742% vs 2021). Warner Bros. Discovery, Inc. generated $4B FCF in 2024 (+83% vs 2021).
WMG vs WBD: Frequently Asked Questions
8 questions · data-driven answers · updated daily
01Is WMG or WBD a better buy right now?
Warner Music Group Corp. (WMG) offers the better valuation at 40.9x trailing P/E (21.0x forward), making it the more compelling value choice. Analysts rate Warner Music Group Corp. (WMG) a "Buy" — based on 24 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which is the better long-term investment — WMG or WBD?
Over the past 5 years, Warner Music Group Corp. (WMG) delivered a total return of -14.6%, compared to -51.6% for Warner Bros. Discovery, Inc. (WBD). A $10,000 investment in WMG five years ago would be worth approximately $9K today (assuming dividends reinvested). Over 10 years, the gap is even starker: WBD returned +12.7% versus WMG's +7.2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
03Which is safer — WMG or WBD?
By beta (market sensitivity over 5 years), Warner Music Group Corp. (WMG) is the lower-risk stock at 0.59β versus Warner Bros. Discovery, Inc.'s 1.73β — meaning WBD is approximately 192% more volatile than WMG relative to the S&P 500. On balance sheet safety, Warner Bros. Discovery, Inc. (WBD) carries a lower debt/equity ratio of 113% versus 6% for Warner Music Group Corp. — giving it more financial flexibility in a downturn.
04Which has better profit margins — WMG or WBD?
Warner Music Group Corp. (WMG) is the more profitable company, earning 5.4% net margin versus -28.8% for Warner Bros. Discovery, Inc. — meaning it keeps 5.4% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: WMG leads at 10.3% versus -25.5% for WBD. At the gross margin level — before operating expenses — WMG leads at 45.8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
05Is WMG or WBD more undervalued right now?
Analyst consensus price targets imply the most upside for WMG: 27.6% to $36.50.
06Which pays a better dividend — WMG or WBD?
In this comparison, WMG (2.6% yield) pays a dividend. WBD does not pay a meaningful dividend and should not be held primarily for income.
07Is WMG or WBD better for a retirement portfolio?
For long-horizon retirement investors, Warner Music Group Corp. (WMG) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.59), 2.6% yield). Warner Bros. Discovery, Inc. (WBD) carries a higher beta of 1.73 — meaning larger drawdowns in market downturns, which matters significantly when you cannot wait years for a recovery. Both have compounded well over 10 years (WMG: +7.2%, WBD: +12.7%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
08What are the main differences between WMG and WBD?
Both stocks operate in the Communication Services sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. WMG pays a dividend while WBD does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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- Sector: Communication Services
- Market Cap > $100B
- Revenue Growth > 5%
- Gross Margin > 27%