Townsquare Media (TSQ) versus Tencent Music Entertainment Group (TME) Critical Contrast

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

Institutional and Insider Ownership

43.6% of Townsquare Media shares are owned by institutional investors. 26.7% of Townsquare Media shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

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

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Townsquare Media 0 1 2 0 2.67
Tencent Music Entertainment Group 0 2 5 0 2.71

Townsquare Media presently has a consensus target price of $10.00, suggesting a potential upside of 71.53%. Tencent Music Entertainment Group has a consensus target price of $15.61, suggesting a potential upside of 8.81%. Given Townsquare Media’s higher probable upside, analysts clearly believe Townsquare Media is more favorable than Tencent Music Entertainment Group.

Dividends

Townsquare Media pays an annual dividend of $0.30 per share and has a dividend yield of 5.1%. Tencent Music Entertainment Group does not pay a dividend. Townsquare Media pays out 40.5% of its earnings in the form of a dividend.

Earnings & Valuation

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Townsquare Media $507.43 million 0.22 -$10.27 million $0.74 7.88
Tencent Music Entertainment Group N/A N/A N/A N/A N/A

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

Profitability

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

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

Summary

Townsquare Media beats Tencent Music Entertainment Group on 7 of the 11 factors compared between the two stocks.

About Townsquare Media

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.

About Tencent Music Entertainment Group

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.

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