Warner Music Group (NASDAQ:WMG) Hits New 52-Week Low - Time to Sell?

Key Points

• Shares of Warner Music Group hit a new 52-week low of $23.39 (last around $23.48), while the Street’s average price target is $35.69 and the consensus rating is a Moderate Buy, implying notable analyst-implied upside despite the drop.
• The company missed quarterly EPS ($0.33 vs. $0.40) though revenue rose 10.4% to $1.84B year-over-year, but balance-sheet metrics show weak liquidity (current ratio ~0.70), very high debt-to-equity (5.3) and a payout ratio above 100% on a 3.2% yield.
• Institutional investors own about 96.9% of the stock, and WMG is trading below both its 50-day ($28.64) and 200-day ($30.22) moving averages, reflecting concentrated ownership and bearish technicals.

Shares of Warner Music Group Corp. (NASDAQ:WMG - Get Free Report) hit a new 52-week low on Tuesday . The company traded as low as $23.39 and last traded at $23.48, with a volume of 642964 shares changing hands. The stock had previously closed at $24.15.

Wall Street Analysts Forecast Growth

A number of equities analysts have recently commented on WMG shares. Jefferies Financial Group lowered their price target on Warner Music Group from $38.00 to $35.00 and set a "buy" rating for the company in a report on Thursday, December 11th. Weiss Ratings reaffirmed a "hold (c)" rating on shares of Warner Music Group in a research note on Monday, December 29th. Citigroup decreased their target price on Warner Music Group from $41.00 to $40.00 and set a "buy" rating on the stock in a research report on Wednesday, January 21st. Scotiabank raised shares of Warner Music Group from a "sector perform" rating to a "sector outperform" rating in a report on Friday, February 13th. Finally, Sanford C. Bernstein restated an "outperform" rating on shares of Warner Music Group in a research note on Wednesday, January 14th. Twelve equities research analysts have rated the stock with a Buy rating and eight have assigned a Hold rating to the company. Based on data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average price target of $35.69.

Warner Music Group Price Performance

The company has a 50 day moving average price of $28.64 and a 200-day moving average price of $30.22. The company has a market cap of $12.30 billion, a price-to-earnings ratio of 40.60, a P/E/G ratio of 0.40 and a beta of 1.24. The company has a quick ratio of 0.69, a current ratio of 0.70 and a debt-to-equity ratio of 5.30.

Warner Music Group (NASDAQ:WMG - Get Free Report) last posted its earnings results on Thursday, February 5th. The company reported $0.33 earnings per share for the quarter, missing analysts' consensus estimates of $0.40 by ($0.07). Warner Music Group had a return on equity of 38.33% and a net margin of 4.43%.The business had revenue of $1.84 billion for the quarter, compared to the consensus estimate of $1.77 billion. During the same period in the previous year, the firm earned $0.45 earnings per share. The company's revenue was up 10.4% compared to the same quarter last year. As a group, equities research analysts predict that Warner Music Group Corp. will post 1.39 EPS for the current fiscal year.

Warner Music Group Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Tuesday, March 3rd. Stockholders of record on Wednesday, February 18th were issued a dividend of $0.19 per share. This represents a $0.76 dividend on an annualized basis and a dividend yield of 3.2%. The ex-dividend date was Wednesday, February 18th. Warner Music Group's payout ratio is 131.03%.

Institutional Trading of Warner Music Group

A number of institutional investors and hedge funds have recently bought and sold shares of the stock. Nisa Investment Advisors LLC grew its position in shares of Warner Music Group by 120.1% in the 3rd quarter. Nisa Investment Advisors LLC now owns 865 shares of the company's stock valued at $29,000 after buying an additional 472 shares during the last quarter. Farther Finance Advisors LLC raised its position in shares of Warner Music Group by 57.5% during the third quarter. Farther Finance Advisors LLC now owns 879 shares of the company's stock worth $30,000 after acquiring an additional 321 shares during the last quarter. GAMMA Investing LLC raised its position in shares of Warner Music Group by 85.7% during the third quarter. GAMMA Investing LLC now owns 1,107 shares of the company's stock worth $38,000 after acquiring an additional 511 shares during the last quarter. Quarry LP acquired a new position in shares of Warner Music Group in the fourth quarter worth approximately $40,000. Finally, Caitong International Asset Management Co. Ltd lifted its stake in shares of Warner Music Group by 774.6% in the third quarter. Caitong International Asset Management Co. Ltd now owns 1,207 shares of the company's stock worth $41,000 after acquiring an additional 1,069 shares during the period. 96.88% of the stock is currently owned by institutional investors and hedge funds.

About Warner Music Group

Warner Music Group is a major global music company that operates across recorded music and music publishing. Its recorded-music business comprises a portfolio of well-known labels—including Atlantic, Warner Records and Parlophone—as well as distribution and artist-services operations that support both established and emerging artists. The company's publishing arm, Warner Chappell Music, manages songwriting catalogs and administers rights for compositions across multiple media, providing licensing for film, television, advertising and other commercial uses.

WMG's activities span the full music value chain: signing and developing artists, producing and marketing recordings, distributing music through physical channels and streaming platforms, and monetizing rights through licensing, synchronization and neighboring-rights collection.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.