Tencent Music Entertainment Group (TME): one to watch?

Wait — Q2 profits actually rose, but management's own guidance for shrinking margins ahead is the real reason to be cautious, not a screaming bargain.

👀 WATCH Fundamentals74/100

Fell 12% in 1 trading day(s) — now $8.72

Why TME dropped

TME dropped ~12% the day after reporting Q2 earnings that actually beat on revenue and profit, but management guided that margins will keep shrinking in the second half due to rising costs from the Ximalaya acquisition and a shift toward lower-margin content.

Fwd P/E 8.3Op margin 31.4%Rev growth 5.8%Debt/equity 20.8%Analyst upside 72.2%

How this scored 74/100

✅ Passes all 4 hard checks — profitable, cash-generative, and financially survivable.

✅ Makes money Net profit margin 26.3%

✅ Generates cash Free cash flow $5.5B

✅ Not drowning in debt Debt/equity 20.8% (limit 200%)

✅ Can pay its bills Current ratio 1.7 (needs 1+)

Bar length shows how much each metric is worth — a 10-point metric is twice as wide as a 5-point one. Hover any row for what it means.

Profitability Does it actually make money? 19/25

Operating margin 31.4% 9/9

Net profit margin 26.3% 8/8

Return on equity 11.0% 2/8

Growth Is it getting bigger, or dying? 12/25

Revenue growth 5.8% 3/9

Earnings growth 0.0% 2/8

Expected profit change 22.9% 7/8

Value Is it cheap right now? 22/25

Forward P/E 8.3 10/10

PEG ratio 1.3 5/8

Analyst target upside 72.2% 7/7

Balance sheet Will it survive? 21/25

Debt / equity 20.8% 10/10

Current ratio 1.7 4/8

Free cash flow $5.5B 7/7

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Analysis generated by SmartStonks's AI from public fundamentals and news, first flagged 2026-08-12. Research only — not financial advice.