Contrasting Tencent Music Entertainment Group (TME) & Townsquare Media (TSQ)

Tencent Music Entertainment Group (NYSE:TME) and Townsquare Media (NYSE:TSQ) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations for Tencent Music Entertainment Group and Townsquare Media, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tencent Music Entertainment Group 0 3 3 0 2.50
Townsquare Media 0 1 2 0 2.67

Tencent Music Entertainment Group presently has a consensus price target of $16.28, suggesting a potential upside of 24.90%. Townsquare Media has a consensus price target of $10.00, suggesting a potential upside of 60.51%. Given Townsquare Media’s stronger consensus rating and higher possible upside, analysts plainly believe Townsquare Media is more favorable than Tencent Music Entertainment Group.

Profitability

This table compares Tencent Music Entertainment Group and Townsquare Media’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tencent Music Entertainment Group N/A N/A N/A
Townsquare Media -9.68% 6.11% 2.16%

Dividends

Townsquare Media pays an annual dividend of $0.30 per share and has a dividend yield of 4.8%. Tencent Music Entertainment Group does not pay a dividend. Townsquare Media pays out 40.5% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Tencent Music Entertainment Group and Townsquare Media’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tencent Music Entertainment Group N/A N/A N/A N/A N/A
Townsquare Media $507.43 million 0.23 -$10.27 million $0.74 8.42

Tencent Music Entertainment Group has higher earnings, but lower revenue than Townsquare Media.

Insider and Institutional Ownership

43.6% of Townsquare Media shares are held by institutional investors. 26.7% of Townsquare Media shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Townsquare Media beats Tencent Music Entertainment Group on 8 of the 11 factors compared between the two stocks.

Tencent Music Entertainment Group Company Profile

Tencent Music Entertainment Group operates an online music entertainment platform that provides online music and music-centric social entertainment services in China. It offers QQ Music, Kugou Music, and Kuwo Music that enable users to discover and listen to music in personalized ways; and WeSing, which enables users to have fun by singing and interacting with friends, sharing their singing performances with friends, and discovering songs that others have sung. The company also operates Kugou Live and Kuwo Live that provides an interactive online stage for performers and users to showcase their talent and engage with those interested in their performance. In addition, it sells music-related merchandise, including Kugou M1 headsets, smart speakers, WeSing karaoke microphones, and Hi-Fi systems; and offers online music event ticketing services, as well as services to smart device and automobile makers to build and operate music services on devices and vehicles. The company was formerly known as China Music Corporation. The company was incorporated in 2012 and is based in Shenzhen, Chiane. Tencent Music Entertainment Group is a subsidiary of Tencent Holdings Limited.

Townsquare Media Company Profile

Townsquare Media, Inc. operates as a radio, digital media, entertainment, and digital marketing solutions company in small and mid-sized markets. It operates through two segments, Local Marketing Solutions and Entertainment. The Local Marketing Solutions segment provides broadcast and digital solutions to advertisers and businesses through its radio stations, Websites, radio stations' online streams, and mobile applications. It also offers digital marketing solutions, such as traditional and mobile enabled Website development and hosting services, e-commerce platforms, search engine and online directory optimization services, online reputation management, and social media management services under the Townsquare Interactive brand; and e-commerce products to consumers and advertisers through its proprietary deal and auction platform. As of December 31, 2017, this segment owned and operated 317 radio stations and approximately 325 Websites in 67 markets in the United States. The Entertainment segment creates, promotes, and produces live events, including festivals, fairs, concerts, expositions, and other experiential events. This segment also offer event production services to third parties; and digital advertising services, as well as owns a proprietary ticketing platform. In addition, it owns and operates a portfolio of 9 music and entertainment based national Websites. The company was formerly known as Regent Communications, Inc. and changed its name to Townsquare Media, Inc. in May 2010. Townsquare Media, Inc. was founded in 1996 and is headquartered in Greenwich, Connecticut.

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