Jefferies Maintains Buy Rating on Tencent Music Entertainment Group with $28 Price Target

Jefferies maintains a Buy rating on Tencent Music Entertainment Group with a price target of $28.00, citing the company's strong position in the music streaming market. The analyst consensus is Strong Buy with a price target consensus of $22.20, a -12.58% downside from current levels.

Jefferies has maintained its Buy rating on Tencent Music Entertainment Group (TME) but increased its price target to $28.00 from $26.00. The analyst firm cited TME's strong position in the music streaming market and impressive second-quarter results as reasons for the upward revision [1]. The stock has been trading near its 52-week high of $22.98 and has delivered a remarkable 102% gain year-to-date.

TME reported quarterly revenue and non-IFRS earnings that exceeded both consensus estimates and Jefferies' projections. The company's financial health is robust, with a "GREAT" overall score and revenue growth of 5.35%. The analyst firm also noted that TME's Bubble feature has been well-received by users, and SVIP subscriber penetration has been rising across the platform [1].

Benchmark, another research firm, also raised its price target for TME to $28.00 from $19.00, maintaining a Buy rating. The price target increase followed TME's strong second-quarter 2025 results, driven by a 46% year-over-year growth in non-subscription music revenues [2]. Benchmark highlighted two structural shifts influencing TME's outlook: rising entertainment spending in China and the company's ability to leverage this trend through product and technology innovation.

TME's partnership with record labels and artists, both domestic and international, has further bolstered its position. The company has expanded its K-pop offerings, established partnerships with renowned Chinese artists, and launched interactive communities for user engagement [3]. These strategic moves have contributed to strong year-over-year advertising revenue growth.

Multiple investment firms have updated their outlook on TME, reflecting optimism about its growth potential. Goldman Sachs raised its price target to $21.00, citing expected growth in average revenue per user (ARPU), particularly from its Super VIP subscription tier. Macquarie increased its target to $26.20, highlighting TME's transformation into a more comprehensive music service. Morgan Stanley adjusted its target to $18.00, maintaining an Overweight rating. Bernstein SocGen Group raised its target to $20.00, emphasizing the strategic partnership with SM Entertainment [1, 2].

TME is set to announce its second-quarter 2025 financial results on August 12, 2025. The analyst consensus is Strong Buy with a price target consensus of $22.20, a -12.58% downside from current levels [1].

References:
[1] https://www.investing.com/news/analyst-ratings/jefferies-raises-tencent-music-entertainment-group-stock-price-target-to-28-93CH-4185743
[2] https://www.investing.com/news/analyst-ratings/tencent-music-entertainment-stock-price-target-raised-to-28-at-benchmark-93CH-4188995
[3] https://fxdailyreport.com/tencent-music-entertainment-group-nysetme-tops-estimates/