Tencent Music: A Misunderstood, Underappreciated And Undervalued Business
Summary
- I initiate my coverage on Tencent Music Entertainment with a BUY recommendation and a base-case target price of $12.15 per share, implying an upside potential of 71%.
- TME is the leading music entertainment company in China, with a dominating market share of approximately 80% and a monthly active user base of 841m.
- In my opinion, investors should regard, and value, TME as a social media company with interesting prospects to laverage its current ecosystem into the metaverse.
- From its all-time-high in March 2021, the TME stock has sold off more than 77% and appears to be extremely undervalued at the current trading price.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of TME either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Not financial advise.
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