Investors in Tencent Music Entertainment Group (NYSE:TME) had a good week, as its shares rose 8.7% to close at US$13.36 following the release of its annual results. The result was positive overall - although revenues of CN¥28b were in line with what the analysts predicted, Tencent Music Entertainment Group surprised by delivering a statutory profit of CN¥4.24 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Tencent Music Entertainment Group after the latest results.

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Taking into account the latest results, the most recent consensus for Tencent Music Entertainment Group from 32 analysts is for revenues of CN¥31.0b in 2025. If met, it would imply a meaningful 9.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 21% to CN¥5.07. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥31.0b and earnings per share (EPS) of CN¥5.08 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

Check out our latest analysis for Tencent Music Entertainment Group

The analysts reconfirmed their price target of US$16.43, showing that the business is executing well and in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Tencent Music Entertainment Group analyst has a price target of US$18.95 per share, while the most pessimistic values it at US$12.89. This is a very narrow spread of estimates, implying either that Tencent Music Entertainment Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One thing stands out from these estimates, which is that Tencent Music Entertainment Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 9.0% annualised growth until the end of 2025. If achieved, this would be a much better result than the 0.06% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 9.7% annually. So it looks like Tencent Music Entertainment Group is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Tencent Music Entertainment Group. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Tencent Music Entertainment Group going out to 2027, and you can see them free on our platform here..

You can also see our analysis of Tencent Music Entertainment Group's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.