Tencent Music Entertainment Group (TME) Financial Ratios
9 years of historical data (2016–2024) · Communication Services · Internet Content & Information
EV/EBITDA
↓
3.88
↑+79% vs avg
5yr avg: 2.16
30Y Low1.0·High4.8
P/FCF
↓
4.83
↑+32% vs avg
5yr avg: 3.67
30Y Low1.9·High7.4
P/B Ratio
↓
1.42
↑+338% vs avg
5yr avg: 0.32
30Y Low0.2·High3.1
ROE
↓
10.5%
↓+11% vs avg
5yr avg: 9.4%
30Y Low0%·High18%
Debt/EBITDA
↓
0.62
↓-33% vs avg
5yr avg: 0.94
30Y Low0.0·High1.1
Percentile shows where the current value sits in 30-year historical distribution. Sparklines show 5-year trend.
TME Valuation Multiples
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
Tencent Music Entertainment Group trades at 14.9x earnings, 258% above its 5-year average of 4.2x, sitting at the 100th percentile of its historical range. This is roughly in line with the Communication Services sector median P/E of 15.4x. On a free-cash-flow basis, the stock trades at 4.8x P/FCF, 32% above the 5-year average of 3.7x.
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $6.6B | $17.8B | $14.3B | $13.4B | $11.5B | $32.3B | $19.7B | $20.9B | — | — |
| Enterprise Value | $5.5B | $10.7B | $6.8B | $9.8B | $10.3B | $26.7B | $17.5B | $3.5B | — | — |
| P/E Ratio → | 14.87 | 2.68 | 2.91 | 3.63 | 3.81 | 7.76 | 4.93 | 11.40 | — | — |
| P/S Ratio | 1.57 | 0.63 | 0.51 | 0.47 | 0.37 | 1.11 | 0.77 | 1.10 | — | — |
| P/B Ratio | 1.42 | 0.25 | 0.25 | 0.27 | 0.23 | 0.61 | 3.13 | 0.55 | — | — |
| P/FCF | 4.83 | 1.92 | 2.31 | 2.08 | 4.64 | 7.37 | 3.32 | 3.81 | — | — |
| P/OCF | 4.35 | 1.73 | 1.95 | 1.79 | 2.20 | 6.62 | 3.17 | 3.71 | — | — |
P/E links to full P/E history page with 30-year chart
TME EV Ratios
Enterprise-value multiples — capital-structure-neutral measures of total business value
Tencent Music Entertainment Group's enterprise value stands at 3.9x EBITDA, 79% above its 5-year average of 2.2x. The Communication Services sector median is 9.0x, placing the stock at a 57% discount on an enterprise-value basis.
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 0.38 | 0.24 | 0.35 | 0.33 | 0.92 | 0.69 | 0.19 | — | — |
| EV / EBITDA | 3.88 | 1.10 | 1.00 | 1.75 | 2.14 | 4.82 | 3.39 | 1.46 | — | — |
| EV / EBIT | 4.31 | 1.21 | 1.35 | 2.18 | 2.74 | 5.64 | 4.27 | 1.73 | — | — |
| EV / FCF | — | 1.15 | 1.09 | 1.52 | 4.15 | 6.09 | 2.95 | 0.64 | — | — |
TME Profitability
Margins and return-on-capital ratios measuring operating efficiency
Tencent Music Entertainment Group earns an operating margin of 30.7%. Operating margins have expanded from 15.7% to 30.7% over the past 3 years, signaling improving operational efficiency. ROE of 10.5% is modest. ROIC of 11.6% represents solid returns on invested capital.
Margins
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 42.3% | 42.3% | 35.3% | 31.0% | 30.1% | 31.9% | 34.1% | 38.3% | 34.7% | 28.3% |
| Operating Margin | 30.7% | 30.7% | 21.8% | 15.7% | 12.2% | 16.2% | 18.2% | 10.7% | 14.5% | 2.4% |
| Net Profit Margin | 23.4% | 23.4% | 17.7% | 13.0% | 9.7% | 14.3% | 15.7% | 9.7% | 12.1% | 1.9% |
Return on Capital
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 10.5% | 10.5% | 9.3% | 7.3% | 5.8% | 14.1% | 18.1% | 5.7% | 5.7% | 0.4% |
| ROA | 8.0% | 8.0% | 6.9% | 5.5% | 4.5% | 11.0% | 15.3% | 4.9% | 5.0% | 0.3% |
| ROIC | 11.6% | 11.6% | 9.5% | 7.0% | 5.9% | 13.8% | 28.3% | 7.4% | 6.2% | 0.4% |
| ROCE | 12.7% | 12.7% | 10.2% | 7.9% | 6.6% | 14.5% | 20.7% | 6.3% | 6.7% | 0.5% |
TME Leverage & Debt
Solvency and debt-coverage ratios — lower is generally safer
Tencent Music Entertainment Group carries a Debt/EBITDA ratio of 0.6x, which is very conservative (82% below the sector average of 3.5x). The company holds a net cash position — cash of $13.2B exceeds total debt of $6.1B, providing substantial financial flexibility for buybacks, acquisitions, or weathering downturns. Interest coverage of 70.2x signals virtually no risk of debt distress — earnings comfortably cover interest obligations.
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.09 | 0.09 | 0.11 | 0.12 | 0.10 | 0.10 | 0.00 | — | — | — |
| Debt / EBITDA | 0.62 | 0.62 | 0.89 | 1.06 | 1.12 | 0.99 | 0.00 | — | — | — |
| Net Debt / Equity | — | -0.10 | -0.13 | -0.07 | -0.02 | -0.11 | -0.35 | -0.46 | -0.20 | -0.15 |
| Net Debt / EBITDA | -0.73 | -0.73 | -1.11 | -0.64 | -0.26 | -1.02 | -0.43 | -7.21 | -2.62 | -9.06 |
| Debt / FCF | — | -0.77 | -1.22 | -0.56 | -0.50 | -1.28 | -0.37 | -3.16 | -2.14 | -3.69 |
| Interest Coverage | 70.24 | 70.24 | 48.86 | 38.63 | 31.40 | 48.56 | 72.22 | 58.26 | — | — |
Net cash position: cash ($13.2B) exceeds total debt ($6.1B)
TME Liquidity & Efficiency
Short-term solvency ratios and asset-utilisation metrics
Tencent Music Entertainment Group's current ratio of 2.09x is well above the 1.0 safety threshold, indicating strong short-term liquidity with ample room to cover current liabilities. The current ratio has declined from 2.27x to 2.09x over the past 3 years.
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 2.09 | 2.09 | 2.49 | 2.27 | 2.56 | 3.30 | 3.16 | 3.33 | 2.12 | 1.98 |
| Quick Ratio | 2.09 | 2.09 | 2.49 | 2.27 | 2.56 | 3.30 | 3.16 | 3.33 | 2.11 | 1.98 |
| Cash Ratio | 1.64 | 1.64 | 1.96 | 1.78 | 1.95 | 2.71 | 2.63 | 2.80 | 1.47 | 1.32 |
| Asset Turnover | — | 0.31 | 0.37 | 0.42 | 0.46 | 0.43 | 3.36 | 0.43 | 0.37 | 0.19 |
| Inventory Turnover | 712.00 | 712.00 | 2244.63 | 1397.57 | 910.00 | 1102.83 | 4490.47 | 334.51 | 239.03 | 223.50 |
| Days Sales Outstanding | — | 45.08 | 38.38 | 37.65 | 44.36 | 37.41 | 4.95 | 28.51 | 43.28 | 67.71 |
TME Shareholder Yields
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Tencent Music Entertainment Group returns 5.8% to shareholders annually — split between a 1.5% dividend yield and 4.3% buyback yield. The payout ratio of 22.7% is conservative, leaving significant room for dividend growth or reinvestment. The earnings yield of 6.7% (inverse of P/E) provides a useful comparison to bond yields when assessing the stock's relative attractiveness to fixed income.
Dividends
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 1.5% | 8.5% | — | — | — | — | 0.2% | 0.1% | — | — |
| Payout Ratio | 22.7% | 22.7% | — | — | — | — | 0.8% | 1.0% | — | — |
Total Shareholder Return Metrics
| Metric | TTM | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 6.7% | 37.4% | 34.4% | 27.5% | 26.3% | 12.9% | 20.3% | 8.8% | — | — |
| FCF Yield | 20.7% | 52.0% | 43.2% | 48.0% | 21.5% | 13.6% | 30.1% | 26.3% | — | — |
| Buyback Yield | 4.3% | 10.8% | 8.8% | 23.4% | 30.2% | 0.4% | 0.0% | 0.0% | — | — |
| Total Shareholder Yield | 5.8% | 19.3% | 8.8% | 23.4% | 30.2% | 0.4% | 0.2% | 0.1% | — | — |
| Shares Outstanding | — | $1.6B | $1.6B | $1.6B | $1.7B | $1.7B | $1.7B | $1.6B | $1.6B | $1.6B |
Peer Comparison
Compare TME with 10 similar companies in its peer group
| Company | Market Cap | P/E | EV/EBITDA | P/FCF | Gross Margin | Op Margin | ROE | ROIC | Debt/EBITDA |
|---|---|---|---|---|---|---|---|---|---|
 TMEYou | $7B | 14.9 | 3.9 | 4.8 | 42.3% | 30.7% | 10.5% | 11.6% | 0.6 |
 SPOT | $88B | 34.7 | 31.3 | 26.1 | 32.0% | 12.8% | 31.9% | 40.5% | 1.0 |
 IDCC | $7B | 23.6 | 12.9 | 13.6 | 80.3% | 55.3% | 41.5% | 40.9% | 0.9 |
 AAPL | $4.2T | 38.5 | 29.7 | 42.7 | 46.9% | 32.0% | 171.4% | 67.4% | 0.8 |
 AMZN | $2.9T | 37.8 | 20.5 | 379.0 | 50.3% | 11.2% | 22.3% | 14.7% | 1.0 |
 GOOGL | $4.8T | 36.8 | 32.2 | 65.7 | 59.7% | 32.1% | 35.7% | 25.1% | 0.4 |
 SIRI | $9B | 11.9 | 9.0 | 7.2 | 47.0% | 17.2% | 7.1% | 5.2% | 4.7 |
 IHRT | $880M | -1.9 | 19.6 | 80.6 | — | -0.5% | — | -0.4% | 17.1 |
 WMG | $16B | 44.3 | 17.5 | 30.1 | 45.8% | 10.3% | 51.0% | 11.4% | 4.0 |
 LYV | $39B | -693.0 | 19.9 | 115.8 | 23.0% | 5.9% | 26.4% | 19.7% | 5.6 |
 SONO | $2B | -29.2 | 142.1 | 16.6 | 43.7% | -3.5% | -15.6% | -13.4% | 5.0 |
| Communication Services Median | — | 15.4 | 9.0 | 11.8 | 48.3% | 0.7% | 2.2% | 3.0% | 3.5 |
Peer selection based on competitive and market overlap. Compare multiple stocks →
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Start ComparisonTME — Frequently Asked Questions
Quick answers to the most common questions about buying TME stock.
What is Tencent Music Entertainment Group's P/E ratio?
Tencent Music Entertainment Group's current P/E ratio is 14.9x. The historical average is 5.3x. This places it at the 100th percentile of its historical range.
What is Tencent Music Entertainment Group's EV/EBITDA?
Tencent Music Entertainment Group's current EV/EBITDA is 3.9x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 2.2x.
What is Tencent Music Entertainment Group's ROE?
Tencent Music Entertainment Group's return on equity (ROE) is 10.5%. The historical average is 8.5%.
Is TME stock overvalued?
Based on historical data, Tencent Music Entertainment Group is trading at a P/E of 14.9x. This is at the 100th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
What is Tencent Music Entertainment Group's dividend yield?
Tencent Music Entertainment Group's current dividend yield is 1.53% with a payout ratio of 22.7%.
What are Tencent Music Entertainment Group's profit margins?
Tencent Music Entertainment Group has 42.3% gross margin and 30.7% operating margin. Operating margin above 20% indicates strong pricing power and cost efficiency.
How much debt does Tencent Music Entertainment Group have?
Tencent Music Entertainment Group's Debt/EBITDA ratio is 0.6x, indicating low leverage. A ratio below 2x is generally considered financially healthy.