Universal Music Group stock rating cut to neutral by UBS

Published 25/06/2025, 10:16
Universal Music Group stock rating cut to neutral by UBS

Investing.com - UBS downgraded Universal Music Group NV (AS:UMG) (OTC:UMGNF) from Buy to Neutral on Wednesday, setting a price target of EUR30.00.

The music entertainment company’s shares have risen 24% year-to-date in USD terms, recovering beyond levels seen before disappointing second-quarter results last year, according to UBS.

UBS noted that 2025 started positively for Universal Music Group, with the company securing new "Streaming 2.0" deals with major platforms Spotify (NYSE:SPOT) and Amazon (NASDAQ:AMZN) while benefiting from accelerated growth in paid streaming volumes.

Despite maintaining a positive outlook on Universal Music Group’s long-term growth potential and its ability to deliver on management’s September 2024 guidance of over 10% EBITDA CAGR for 2023-2028, UBS believes these factors are now fully reflected in the share price.

The downgrade comes as Universal Music Group shares trade at a 3.0% 2025 estimated free cash flow yield, which UBS notes is in-line with RELX (2.9%) and at a premium to Wolters Kluwer (AS:WLSNc) (3.8%).

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.