Reviewing Tencent Music Entertainment Group (NYSE:TME) & Starz Entertainment (NASDAQ:STRZ)

Starz Entertainment (NASDAQ:STRZ – Get Free Report) and Tencent Music Entertainment Group (NYSE:TME – Get Free Report) are both communication services companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Risk and Volatility

Starz Entertainment has a beta of 2.55, suggesting that its share price is 155% more volatile than the S&P 500. Comparatively, Tencent Music Entertainment Group has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Starz Entertainment and Tencent Music Entertainment Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Starz Entertainment 1 3 4 1 2.56
Tencent Music Entertainment Group 0 10 3 0 2.23

Starz Entertainment presently has a consensus price target of $32.71, indicating a potential upside of 43.17%. Tencent Music Entertainment Group has a consensus price target of $17.21, indicating a potential upside of 121.28%. Given Tencent Music Entertainment Group’s higher possible upside, analysts clearly believe Tencent Music Entertainment Group is more favorable than Starz Entertainment.

Institutional & Insider Ownership

24.3% of Tencent Music Entertainment Group shares are owned by institutional investors. 22.6% of Starz Entertainment shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Starz Entertainment 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
Starz Entertainment $963.40 million 0.41 -$115.80 million ($25.49) -0.90
Tencent Music Entertainment Group $4.71 billion 2.60 $1.54 billion $0.81 9.60

Tencent Music Entertainment Group has higher revenue and earnings than Starz Entertainment. Starz Entertainment is trading at a lower price-to-earnings ratio than Tencent Music Entertainment Group, indicating that it is currently the more affordable of the two stocks.

Profitability

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

Net Margins Return on Equity Return on Assets
Starz Entertainment -33.98% -25.64% -6.79%
Tencent Music Entertainment Group 26.27% 11.53% 8.87%

Summary

Tencent Music Entertainment Group beats Starz Entertainment on 10 of the 15 factors compared between the two stocks.

About Starz Entertainment

(Get Free Report)

Starz is a premium cable and streaming network owned by Starz Entertainment, which was formerly a part of Lionsgate. Starz had about 20 million subscribers in the U.S. and Canada as of Dec. 31, 2024. The company’s franchises include “Outlander” and “Power.”

About Tencent Music Entertainment Group

(Get Free Report)

Tencent Music Entertainment Group operates online music entertainment platforms to provide music streaming, online karaoke, and live streaming services in the People's Republic of China. It offers QQ Music, Kugou Music, and Kuwo Music that enable users to discover music in personalized ways; long-form audio content, including audiobooks, podcasts and talk shows, as well as music-oriented video content comprising music videos, live performances, and short videos; and WeSing, which enables users to sing along from its library of karaoke songs and share their performances in audio or video formats with friends. The company also delivers music-centric live streaming services primarily through the Live Streaming tab on QQ Music, Kugou Music, Kuwo Music, WeSing, Kugou Live, and Kuwo Live that provides an interactive online stage for performers and users to showcase their talent and engage with a diverse audience base; and Lazy Audio, an audio platform. In addition, it sells music-related merchandise; and artist-related merchandise, such as branded apparel, posters and art prints, and accessories and integrated and technology-driven music solutions that help IoT device manufacturers build and operate their branded music services on their IoT devices, as well as offers advertising services across its online karaoke platform and online music apps. The company is headquartered in Shenzhen, China. Tencent Music Entertainment Group is a subsidiary of Tencent Holdings Limited.

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