Warner Music Group: Buy Rating Reaffirmed Despite Short-Term Challenges

TD Cowen analyst Doug Creutz reiterated a Buy rating on Warner Music Group (WMG – Research Report) today and set a price target of $36.00.

Doug Creutz has given his Buy rating due to a combination of factors despite Warner Music Group’s recent financial performance challenges. The company reported lower-than-expected results for the second fiscal quarter, with both revenue and adjusted OIBDA falling short of estimates. This was largely attributed to a deceleration in streaming growth, particularly in subscription streaming, and market share losses in China.
However, Creutz maintains a positive outlook on Warner Music Group’s stock, reiterating a Buy rating while adjusting the price target from $41 to $36. He acknowledges the company’s challenges but sees potential in areas such as physical sales and licensing, which showed growth. The expectation is that the company will navigate through these short-term hurdles, and the long-term prospects remain favorable, justifying the Buy recommendation.

Creutz covers the Communication Services sector, focusing on stocks such as Playtika Holding, Live Nation Entertainment, and Nintendo Co. According to TipRanks, Creutz has an average return of 16.9% and a 63.59% success rate on recommended stocks.