Warner Music Group

WMG

Entertainment · Communication Services

Price

$27.13

+0.03 (+0.11%)

Market Cap

$14.16B

Exchange

NASDAQ

Winston Score

Winston is curious

A decent business — some strong pillars, some weaker.

Data as of Aug 23, 2026 · filings through Jun 30, 2026

How the score breaks down

Quality

Good

Growth

Good

Cash Flow

Strong

Stability

Mixed

Valuation

Strong

Dividends

Good

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Share count rising — dilution

+1.1% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 513.5M (2021) → 519.0M (2025)

Winston Score History

The full picture

Warner Music Group is one of the three major record labels in the world, alongside Universal Music Group and Sony Music. It discovers, signs, and promotes musicians, then sells or licenses their music to listeners everywhere. Its roster includes artists like Ed Sheeran, Bruno Mars, and Cardi B, and it also owns Warner Chappell Music, one of the largest music publishing companies globally.

Warner Music makes money in two main ways: recorded music (streaming royalties, downloads, physical sales, and touring deals) and music publishing (licensing songs for use in films, ads, and TV). It operates worldwide, with significant revenue from the US, UK, and Europe, and generates roughly $6 billion in annual revenue. Its deep catalog of songs — some dating back decades — acts as a durable competitive moat, since classic hits keep earning royalties indefinitely. The key growth driver is streaming expansion in emerging markets, while the main risk is continued pressure on artist royalty rates as platforms like Spotify gain negotiating power.

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Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+10.4% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

>+1,000% YoY

YoY Growth Rate

EPS growth accelerating

R&D Spend

$0/ year

0.0% of revenue

Below sector average (12%)

Research and development spending

Insider Activity

2.0%ownership

→ Flat

Insider ownership roughly steady over the past year

Cash Position

Cash flow positive

$618M cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

Warner Music Group is a rare growth stock that's already generating positive cash flow while growing at 10%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

Each metric is explained in plain language so you know exactly what you're looking at. Start your free trial now.

Quality

Profit per sale

Gross Margin

45.8%

Healthy — 45.8% gross margin

Profit after running costs

Operating Margin

16.4%

Healthy — 16.4% operating margin

Return on the money invested

ROCE

18.8%

Strong — 18.8% return on capital

ROIC between 15% and 25%. Every dollar invested in the business earns 15 to 25 cents back per year.

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Growth

Sales growth

Sales YoY

+12.9%

Fast-growing sales (+12.9% YoY)

Profit growth

EPS YoY

+127.9%

Earnings growing fast (+127.9% YoY)

Earnings growing 25%+ a year. The compounder zone.

How steady the profit is

EPS Consistency

4/8 quarters

Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash

Cash Conversion

141%

Turns 141% of profit into real cash

Spare cash per sale

FCF Margin

10.5%

Modest free cash flow (10.5%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

What it owes vs what it owns

Debt / Equity

5.52

Heavy debt load (5.52)

Covers its interest

Interest Cover

5.97x

Adequate interest coverage (6.0x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

Price vs profit

P/E Ratio (TTM)

21.0x

Growth-priced — P/E 21.0

P/E above the market average. People are paying up for expected growth.

Cheaper or dearer next year

P/E vs Forward

+8.1

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (21.0 → 13.0)

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Dividends

Dividend

Dividend Yield

2.82%

Moderate income — 2.82% yield

Standard yield zone for stable dividend payers. A meaningful piece of total return.

Dividend record

Dividend Growth

+5.5%

Dividend growing modestly (5.5% YoY)

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