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Tencent Music Entertainment Group has the Financial Strength Rank of 7.
Good Sign:
Tencent Music Entertainment Group shows strong financial strength.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is rated on a scale of 1 to 10 and is based on these factors:
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.
4. Other debt related ratios.
A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Tencent Music Entertainment Group's Interest Coverage for the quarter that ended in Jun. 2026 was 530.74.
Tencent Music Entertainment Group's debt to revenue ratio for the quarter that ended in Jun. 2026 was 0.47.
As of today, Tencent Music Entertainment Group's Altman Z-Score is 2.76.
Tencent Music Entertainment Group (NYSE:TME) Financial Strength Explanation
The rank is rated on a scale of 1 to 10. A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Tencent Music Entertainment Group has the Financial Strength Rank of 7.
Tencent Music Entertainment Group Financial Strength Related Terms
TME vs PINS, MTCH, SNAP: Financial Strength Comparison
For the Internet Content & Information subindustry, Tencent Music Entertainment Group's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Tencent Music Entertainment Group Financial Strength vs Interactive Media Industry
For the Interactive Media industry and Communication Services sector, Tencent Music Entertainment Group's Financial Strength distribution charts can be found below:
* The bar in red indicates where Tencent Music Entertainment Group's Financial Strength falls into.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
Tencent Music Entertainment Group has a Z-score of 2.76, indicating it is in Grey Zones. This implies that Tencent Music Entertainment Group is in some kind of financial stress. If it is below 1.81, the company may faces bankrupcy risk.
Warning Sign:
Altman Z-score of 2.76 is in the grey area. This implies that the company is under some kind of financial stress. If it is below 1.8, the company may face bankruptcy risk.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Tencent Music Entertainment Group (TME) has a Financial Strength of 7 as of Jun. 2026. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on Tencent Music Entertainment Group and its competitors. This is 22% below median its historical median of 9.00. Over the past decade, Tencent Music Entertainment Group's Financial Strength has ranged from 3.00 to 10.00.
Is Tencent Music Entertainment Group's Financial Strength too high?
Tencent Music Entertainment Group's current Financial Strength of 7 is 22% below median its 10-year median of 9.00. Over the past 10 years, this metric has ranged from a low of 3.00 to a high of 10.00. Overall, Tencent Music Entertainment Group has a GF Score™ of 74/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Tencent Music Entertainment Group's Financial Strength compare to PINS and MTCH?
Tencent Music Entertainment Group's Financial Strength of 7 can be compared against companies in the Interactive Media industry. Historically, Tencent Music Entertainment Group's own Financial Strength has ranged from 3.00 to 10.00 over the past decade. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Financial Strength for an Interactive Media company?
A good Financial Strength depends on the Interactive Media industry context. However, Financial Strength should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Financial Strength mean?
A high Financial Strength can signal that a stock is expensive relative to its fundamentals. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on Tencent Music Entertainment Group and its competitors. Tencent Music Entertainment Group's current Financial Strength is 7, which is 22% below median its own 10-year median of 9.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Tencent Music Entertainment Group stock overvalued right now?
Based on GuruFocus' analysis, Tencent Music Entertainment Group (TME) is currently considered Significantly Undervalued. The stock's GF Value™ is $15.41, compared to a current price of $8.46 — trading 45.1% below its estimated fair value. The current Financial Strength is 7, which is 22% below median its 10-year median of 9.00. Tencent Music Entertainment Group's overall GF Score™ is 74/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Financial Strength calculated?
Financial Strength is calculated from a company's financial statements. For Tencent Music Entertainment Group (TME), the current Financial Strength is 7 as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Tencent Music Entertainment Group (TME) Overvalued in 2026?
Based on GuruFocus' analysis, Tencent Music Entertainment Group stock appears to be undervalued.
The current stock price of $8.46 is trading 45.1% below its estimated GF Value™ of $15.41.
GuruFocus considers Tencent Music Entertainment Group to be Significantly Undervalued.
Key valuation signals for TME:
Financial Strength: 7 (22% below median its 10-year median of 9.00)
GF Value™: $15.41 vs. price of $8.46 (45.1% below fair value)
No single metric tells the full story. See the TME stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Tencent Music is the largest online music streaming platform in China, established in 2016 through the merger of QQ Music, Kuwo Music, and Kugou Music. Tencent, its largest shareholder, holds over 50% of the shares and more than 90% of the voting rights. Beyond streaming services, Tencent Music generates revenue through a diverse range of offerings, including podcasts, livestreaming, concerts, and karaoke.
74GF Score
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