Critical Survey: Tencent Music Entertainment Group (NYSE:TME) versus Liberty Media Corporation – Liberty Formula One Series A (NASDAQ:FWONA)

Liberty Media Corporation – Liberty Formula One Series A (NASDAQ:FWONA) and Tencent Music Entertainment Group (NYSE:TME) are both large-cap consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, dividends, risk, institutional ownership, valuation, analyst recommendations and earnings.

Volatility & Risk

Liberty Media Corporation – Liberty Formula One Series A has a beta of 0.54, indicating that its share price is 46% less volatile than the S&P 500. Comparatively, Tencent Music Entertainment Group has a beta of 0.45, indicating that its share price is 55% less volatile than the S&P 500.

Earnings and Valuation

This table compares Liberty Media Corporation – Liberty Formula One Series A and Tencent Music Entertainment Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Liberty Media Corporation – Liberty Formula One Series A	$3.32 billion	6.12	$195.04 million	$0.78	104.08
Tencent Music Entertainment Group	$3.89 billion	N/A	$924.18 million	$0.96	17.51

Tencent Music Entertainment Group has higher revenue and earnings than Liberty Media Corporation – Liberty Formula One Series A. Tencent Music Entertainment Group is trading at a lower price-to-earnings ratio than Liberty Media Corporation – Liberty Formula One Series A, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

8.4% of Liberty Media Corporation – Liberty Formula One Series A shares are owned by institutional investors. Comparatively, 24.3% of Tencent Music Entertainment Group shares are owned by institutional investors. 3.0% of Liberty Media Corporation – Liberty Formula One Series A shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Liberty Media Corporation – Liberty Formula One Series A and Tencent Music Entertainment Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Liberty Media Corporation – Liberty Formula One Series A	1	2	3	1	2.57
Tencent Music Entertainment Group	0	3	9	1	2.85

Liberty Media Corporation – Liberty Formula One Series A presently has a consensus target price of $103.00, indicating a potential upside of 26.88%. Tencent Music Entertainment Group has a consensus target price of $25.79, indicating a potential upside of 53.45%. Given Tencent Music Entertainment Group’s stronger consensus rating and higher probable upside, analysts clearly believe Tencent Music Entertainment Group is more favorable than Liberty Media Corporation – Liberty Formula One Series A.

Profitability

This table compares Liberty Media Corporation – Liberty Formula One Series A and Tencent Music Entertainment Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Liberty Media Corporation – Liberty Formula One Series A	N/A	N/A	N/A
Tencent Music Entertainment Group	34.00%	11.13%	8.79%

Summary

Tencent Music Entertainment Group beats Liberty Media Corporation – Liberty Formula One Series A on 10 of the 13 factors compared between the two stocks.

About Liberty Media Corporation – Liberty Formula One Series A

Formula One Group, through its subsidiary Formula 1, engages in the motorsports business in the United States and internationally. The company holds commercial rights for the FIA Formula One world championship, approximately a nine-month long motor race-based competition in which teams compete for the constructors' championship and drivers compete for the drivers' championship. It is also involved in the operation of the Formula 1 Paddock Club hospitality program; and provision of freight, logistical, and travel related services for the teams and other third parties, as well as the F2 and F3 race series. The company was founded in 1950 and is based in Englewood, Colorado. Formula One Group operates as a subsidiary of Liberty Media Corporation.

About Tencent Music Entertainment Group

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.