Where Have All the Tencent Music Entertainment Group (TME) Stock Bears Gone?

On December 03, 2019, Tencent Music Entertainment Group (NYSE:TME) shares lost -1.28% or -0.16 points to close at $12.38 with a thin trading volume of 3.294 million shares. It opened the trading session at $12.32, the shares rose to $12.445 and dropped to $12.2501, the range by which the price of stock traded the whole day. The company now has a market cap of $20.2 billion and currently has 1.63 billion outstanding shares. Tencent Music Entertainment Group (TME) stock has plunged -12.32 percent of market value in 21 trading days.

TME stock’s trailing 3-year beta is 0, meaning there will be a lower rate of return, although posing a lower risk. The part of a firm’s profit given to each outstanding share of regular stock was $0.17 share in the trailing 52 weeks. The stock’s value fallen -6.35 percent year to date (YTD) compared to a decline of 0 percent in 52 week’s period. The firm’s shares are still trading -38.01 percent below its 1-year high of $19.97 and 4.83 percent up from 52-week low of $11.81. The average consensus ranking on the company is 2.1, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a sell.

Tencent Music Entertainment Group (TME) is most likely going to rise 29.89 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $19-month high price target. This represents a whopping 53.47 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $16.2, which means a return possibility of 30.86 percent in comparison with the closing price of the stock of $12.38 on December 03. The lowest price set for the stock is $12.4 — just above 0.16 percent from TME share price now.

Investors will get the next hint of TME’s Q4 earnings on March 24. Analysts are predicting revenue to climb 28.4 percent to $1B in the financial fourth quarter, while EPS will soar by about 25 percent to $0.1 per share. Revenue for the quarter was $928.21M, topping the $913.59M analysts had expected. Earnings are seen to rise by 38.2 percent this year, 21.52 percent in the coming year and the trend continues by 4.11 percent every year in the next 5 years.

The stock is lingering around the initial support level of $12.27. After this, the following support is at the zone of $12.16. Up until the time the TME stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 42.07 on the daily chart, and this may be a cause for concern. In case the price goes below $12.16 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $12.47 level may cause a pull-back move approaching $12.55 mark.

Tencent Music Entertainment Group (TME) shares are trading at a P/E ratio of 69.8 times earnings posted in the trailing 12 months. The industry TME deals with has an average P/E of 33.3. Its P/B ratio is standing at 3.5X compared to the 4.9 industry average. It is additionally sporting a 6.1 on the Price-to-Sales ratio, compared to the industry’s P/S average of 5.8. Tencent Music Entertainment Group has a 34.1% gross profit margin, with its operating margin around 7.7%. Alongside this, the company’s net profit margin currently stands at 8.8%.