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WMG

📡 Communication Services

Warner Music Group Corp.

Conservative #394Aggressive #580Low RiskModerate 71
$26.90-1.93%
Day High$27.45
Day Low$26.76
Volume4.0M
Mkt Cap$14.0B
52W Low $2652W High $36
Market Cap
$15.4B
P/E Ratio
51.7
Sector avg: 120.6
Rev Growth
4.4%
Sector avg: 15.4%
Earnings Growth
-16.1%
Profit Margin
5.4%
Sector avg: -115.9%
Debt/Equity
7.12

Why This Score

WMG scores 56.4 on the Conservative profile, blending a fundamental score (80% weight, emphasizing quality and stability (84% of fundamental weight)) with a machine-learning signal (20% weight) trained on 82 features across 30 years of data.

Strengths
  • Strong profitability: ROE of 56.4% exceeds the 15% quality threshold.
  • High conviction (71/100) — fundamental and ML signals agree on this stock.
Risk Factors
  • Elevated valuation at 51.7x earnings — requires sustained growth to justify the premium.
  • Elevated leverage (D/E 7.12) increases financial risk in a rising-rate environment.

Minor adjustments (-0.7 points) applied. WMG's rank of #394 primarily reflects its factor profile relative to the conservative weight vector.

Score Breakdown

Overall Score56.4
Fundamental Score49.1
ML Score69.0

Score by Horizon

3 Month
64.7
6 Month
72.3
Primary
1 Year
76.1

Quality Assessment

A
Earnings Grade
Strong fundamentals, high earnings quality
Quality Flags
Extreme leverage: D/E ratio of 7.1x — balance sheet risk

Position Sizing

Suggested Allocation
5%
Confidence
high

Score Composition Waterfall

How each component affects the final score
Backtested Scoring Levers (IC-calibrated from 30y ElasticNet)
Weinstein (12.1%)
0
Declining
Sentiment (2.5%)
52
Neutral
Analyst (6.4%)
66
Favorable
Tradability (post-hoc)
95
Grade A
Base
53.1
SHAP
+2.4
Factors
+1.6
Divergence
-0.7
Final
56.4
Positive adjustment
Negative adjustment
Base blend
Final score

Factor Breakdown

46AVG
Value40
Quality55
Growth45
Stability35
Investment55

Signal SegmentsComputed from ML features

Fundamental (Valuation, Quality, Growth)35.0
Technical (Momentum, Weinstein, Volatility)56.0
External (Sentiment, Analyst, Macro)79.0
Scores below 50 indicate weakness in that segment relative to the universe.

Data Quality

Score
Features
Confidence
Feature Coverage96%

Growth Estimates

Short-term
-0.3% to +4.0%
Medium-term
+0.2% to +6.8%
Long-term
+0.8% to +9.5%

ML Model Core Features100 trained inputs → ML Score: 69

These features are direct inputs to the machine learning model. The model was trained on these signals alongside 100 features (including 12 momentum/technical indicators) to produce the ML percentile score.

Analyst Intelligence
Consensus Score65.6/100
Target Upside+28.2%
Coverage24 analysts
Market Sentiment
Sentiment Score51.6/100
News Volume1 articles
Technical Stage
Weinstein Stage4 — Declining
12M Momentum-0.1%
6M Momentum-0.1%
Volatility+0.1%
Momentum & Technical
Momentum Acceleration+0.1%
Momentum ConsistencyStrong (0.99)
Relative Strength vs Sector-10.5%
Trend Strength (ADX Proxy)Weak (1.3)
Momentum Quality-0.087
Momentum BreadthNarrow
Macro Regime
Bull RegimeYes
High Vol RegimeNo
S&P 500 Return+25.0%
Yield Curve-0.1bp

Sector-Relative AnalysisIn-model features

Value Trap Signal
7%
Low risk
Sector RevGr Rank
P53
Revenue growth vs Communication Services peers
Sector PE Rank
P18
Valuation vs Communication Services peers
Sector FCF Rank
P81
Free cash flow vs Communication Services peers
Growth Deviation
+0.0σ
Z-score vs sector median
Stagnation Flag
NO
Not flagged

Analysis Signals

Scoring Factors
Fundamental score of 61 relative to sector peers61/100
Machine learning model ranks this stock at the 76th percentileP76
ML model weight reduced to 9% due to macro conditions: market in extended rally phase; yield curve inverted (recession indicator); late-cycle economic indicators detected9% ML weight
SHAP feature alignment: +2.5pt (features align with model priorities)
Blend: 91% fund (60.8) + 9% ML (75.6) + SHAP(+2.5) = 64.7
Factor quality: +1.6pt (multi-factor composite)
Risk assessment: low. Annualized volatility 8.0%. Max drawdown 17% (-3.6 pts). Price momentum -10% (-1.1 pts)Low
Market cap adjustment: +2.0 points ($15.4B market cap)+2.0 pts
Risk Factors
Earnings quality grade A: strong earnings quality and financial health. Score adjusted by -10 pointsGrade A
Quality concern: Extreme leverage: D/E ratio of 7.1x — balance sheet riskFlag

Sector Peer Comparison(Communication Services — Rank #15 of 63 stocks)

StockScoreP/ERev GrowthMarginMkt Cap
WMG56.451.74.4%5.4%$15.4B
GOOGL82.828.315.1%32.8%$3.7T
EA75.175.1-1.3%15.0%$50.2B
MTCH74.512.83.4%15.8%$7.3B
META72.027.222.2%30.1%$1.6T
TIGO69.810.12.5%4.4%$11.0B
BZ65.521.923.6%21.5%$8.1B
NXST65.214.49.6%13.4%$7.0B
SIRI63.69.5-1.6%9.4%$7.2B
CMCSA63.65.9-0.0%16.2%$115.0B
JOYY60.91.9-1.3%83.2%$3.3B
EVER60.610.473.7%8.4%$566M
NFLX59.630.415.9%24.3%$326.1B
TMUS59.322.68.5%12.4%$245.5B
NWS56.712.62.4%12.2%$14.7B
VEON56.16.08.3%15.2%$3.9B
Sector Average42.3120.615.4%-115.9%

Market Sentimentvia FMP

Analyst Consensus
Buy24 analysts
Buy: 16Hold: 7Sell: 1
Price Target
$37consensus
Low $33Median $37High $39
+35.7% to consensus target

Company Overviewvia FMP

Warner Music Group Corp. operates as a music entertainment company in the United States, the United Kingdom, Germany, and internationally. The company operates through Recorded Music and Music Publishing segments. The Recorded Music segment is involved in the discovery and development of recording artists, as well as related marketing, promotion, distribution, sale, and licensing of music created by such recording artists; markets its music catalog through compilations and reissuances of previously released music and video titles, as well as previously unreleased materials; and conducts its operation primarily through a collection of record labels, such as Warner Records and Atlantic Records, as well as Asylum, Big Beat, Canvasback, East West, Erato, FFRR, Fueled by Ramen, Nonesuch, Parlophone, Reprise, Roadrunner, Sire, Spinnin' Records, Warner Classics, and Warner Music Nashville. This segment markets, distributes, and sells music and video products to retailers and wholesale distributors; independent labels to retail and wholesale distributors; and various distribution centers and ventures, as well as retail outlets, online physical retailers, streaming services, and download services. The Music Publishing segment owns and acquires rights to approximately one million musical compositions comprising pop hits, American standards, folk songs, and motion picture and theatrical compositions. Its catalog includes approximately 100,000 songwriters and composers; and various genres, including pop, rock, jazz, classical, country, R&B, hip-hop, rap, reggae, Latin, folk, blues, symphonic, soul, Broadway, electronic, alternative, and gospel. This segment also administers the music and soundtracks of various third-party television and film producers and studios. The company was founded in 1929 and is headquartered in New York, New York.

CEO
Robert Kyncl
Employees
5,800
Beta
1.24
Industry
Entertainment
FMP-Identified Peers

Technical Picturecomputed from daily prices

RSI (14)
43.4
Neutral
Trend
Bearish
10-day vs 50-day MA
From 52W High
-25.3%
High: $36
From 52W Low
+5.2%
Low: $25.56
Moving Averages
10-Day
$28.80
Below
20-Day
$29.10
Below
50-Day
$29.60
Below
200-Day
$30.10
Below
60-Day Support
$26.42
60-Day Resistance
$31.62
Weinstein Stage Analysisbased on 200-day SMA framework
Stage 4 — DecliningScore: 20/100

Stock is in a downtrend below the 200-day moving average. Price is below both the 50-day and 200-day SMAs, indicating sustained selling pressure.

Unfavorable technical position; wait for Stage 1 basing
Price vs 200 SMA
-10.6%
200 SMA Slope (60d)
-2.36%
Falling
Volume Ratio
1.13x
10d avg vs 50d avg
Days in Stage
10
Confidence: 90%

Financial Statementslast 4 quarters via FMP

MetricQ1 2025Q4 2025Q3 2025Q2 2025
Revenue$1.8B$1.9B$1.7B$1.5B
Gross Profit$754M$834M$776M$693M
Operating Income$327M$143M$169M$168M
Net Income$176M$109M$-16M$36M
EPS (Diluted)$0.34$0.21$-0.03$0.07
Gross Margin41.0%44.6%45.9%46.7%
Operating Margin17.8%7.7%10.0%11.3%
Net Margin9.6%5.8%-0.9%2.4%

Why This Stock

Communication ServicesEarnings quality grade AValuation below sector median (P/E 51.7)

Tradability FilterGrade A — 95/100Score impact: -5.3pt

Volume
100
2.5M avg/day
Dollar Vol
100
$71M/day
Float
100
512M shares
Mkt Cap
82
$15.4B
Range
81
41% spread
Composite Liquidity Score95/100
FDCBA

Growth Projection Adjustment

0.7x dampening
weinstein basing

Growth estimates have been dampened based on technical and fundamental signals. This is a post-hoc adjustment to prevent overly optimistic projections for stocks showing declining momentum or deteriorating fundamentals.

Free Float
98.0%
Outstanding Shares
522M
Bid-Ask Spread
41.0%
Institutional Tradable
Yes

Scores are generated by a multi-stage ML pipeline combining fundamental analysis, ensemble predictions, and structural risk signals. All data is for research purposes only and does not constitute financial advice. Past performance does not guarantee future results.