Warner Music Group (NASDAQ:WMG) Shares Gap Up – Here’s What Happened

Warner Music Group Corp. (NASDAQ:WMG) shares gapped up prior to trading on Monday . The stock had previously closed at $25.96, but opened at $27.27. Warner Music Group shares last traded at $26.1570, with a volume of 565,826 shares.

Warner Music Group News Roundup

Here are the key news stories impacting Warner Music Group this week:

• Positive Sentiment: Preliminary results beat expectations. Warner Music Group said fiscal third-quarter results exceeded analyst expectations, providing a favorable signal ahead of the company’s full earnings release. Warner Music Group preliminary results beat expectations
• Positive Sentiment: Streaming growth remained strong. Fiscal Q3 revenue increased approximately 10%, supported by double-digit growth in streaming. Recorded-music subscription streaming revenue rose 11% year over year during calendar Q2, suggesting the core recurring-revenue business remains healthy. Warner Music Group Q3 revenue growth Warner Music Group subscription revenue growth and CFO filing
• Positive Sentiment: Analyst sentiment is moderately favorable. Warner Music Group received an average “Moderate Buy” rating, which may provide some support if the company confirms its preliminary performance. Warner Music Group analyst rating
• Neutral Sentiment: Official results are due earlier than previously scheduled. WMG will release fiscal third-quarter results on August 5, followed by a conference call at 4:30 p.m. ET. The report and management’s outlook could determine whether the preliminary beat translates into sustained investor confidence. Warner Music Group earnings conference call
• Negative Sentiment: CFO Armin Zerza is departing after roughly one year. Lou Dickler was appointed acting CFO, while Tom Corson was promoted to chief operating officer. Although the filing indicates the change was not prompted by a weak quarter, the abrupt finance transition may raise concerns about execution, reporting continuity and leadership stability. Warner Music Group CFO departure Tom Corson named COO

Analyst Ratings Changes

A number of research firms have issued reports on WMG. Wall Street Zen downgraded Warner Music Group from a “buy” rating to a “hold” rating in a research report on Saturday, July 18th. Sanford C. Bernstein reaffirmed an “outperform” rating on shares of Warner Music Group in a research note on Friday, May 8th. Guggenheim boosted their target price on Warner Music Group from $34.00 to $36.00 and gave the stock a “buy” rating in a report on Friday, May 8th. Morgan Stanley set a $39.00 target price on shares of Warner Music Group in a research report on Friday, May 8th. Finally, JPMorgan Chase & Co. raised their target price on shares of Warner Music Group from $40.00 to $43.00 and gave the company an “overweight” rating in a research note on Friday, May 8th. Fourteen analysts have rated the stock with a Buy rating and four have given a Hold rating to the stock. According to MarketBeat.com, Warner Music Group has a consensus rating of “Moderate Buy” and a consensus price target of $38.43.

Warner Music Group Stock Down 1.3%

The firm has a 50 day moving average price of $28.76 and a two-hundred day moving average price of $28.86. The company has a quick ratio of 0.71, a current ratio of 0.73 and a debt-to-equity ratio of 5.62. The company has a market capitalization of $13.37 billion, a price-to-earnings ratio of 30.17, a P/E/G ratio of 0.38 and a beta of 1.30.

Warner Music Group (NASDAQ:WMG) last announced its earnings results on Thursday, May 7th. The company reported $0.44 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.30 by $0.14. Warner Music Group had a return on equity of 62.01% and a net margin of 6.34%.The business had revenue of $1.73 billion for the quarter, compared to analyst estimates of $1.61 billion. During the same period in the previous year, the company earned $0.07 earnings per share. The company’s revenue for the quarter was up 16.7% compared to the same quarter last year. As a group, sell-side analysts expect that Warner Music Group Corp. will post 1.52 earnings per share for the current year.

Warner Music Group Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Tuesday, June 2nd. Shareholders of record on Tuesday, May 26th were given a $0.19 dividend. This represents a $0.76 dividend on an annualized basis and a dividend yield of 3.0%. The ex-dividend date of this dividend was Tuesday, May 26th. Warner Music Group’s dividend payout ratio is presently 89.41%.

Institutional Trading of Warner Music Group

A number of hedge funds have recently made changes to their positions in WMG. JPMorgan Chase & Co. grew its holdings in Warner Music Group by 15.2% during the 4th quarter. JPMorgan Chase & Co. now owns 16,645,276 shares of the company’s stock worth $510,511,000 after acquiring an additional 2,200,362 shares in the last quarter. FIL Ltd raised its stake in shares of Warner Music Group by 0.8% in the 4th quarter. FIL Ltd now owns 5,880,751 shares of the company’s stock valued at $180,363,000 after purchasing an additional 47,760 shares in the last quarter. Millennium Management LLC lifted its position in shares of Warner Music Group by 22.0% during the fourth quarter. Millennium Management LLC now owns 3,885,483 shares of the company’s stock worth $119,168,000 after purchasing an additional 701,829 shares during the last quarter. UBS Group AG lifted its position in shares of Warner Music Group by 44.1% during the fourth quarter. UBS Group AG now owns 3,208,063 shares of the company’s stock worth $98,391,000 after purchasing an additional 981,912 shares during the last quarter. Finally, Thrivent Financial for Lutherans grew its stake in Warner Music Group by 36.9% in the fourth quarter. Thrivent Financial for Lutherans now owns 2,976,111 shares of the company’s stock worth $91,277,000 after purchasing an additional 802,694 shares in the last quarter. Institutional investors and hedge funds own 96.88% of the company’s stock.

Warner Music Group Company Profile

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.