Can Warner Music Stock Get Back To Where It Was?
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Shares of Warner Music Group (WMG) closed at their high in October 2021, and today trade about a third below that price. It is easy to use that old close as a yardstick, measuring every rally by how much ground it recovers, as if the high were where the shares belong. So what would it take for Warner Music stock to get back there?
Warner Music Stock Needs A 52% Gain To Recover
The latest closing price leaves Warner Music stock 34.3% below its old high, and the shares need a 52.2% gain to climb back. Even if the climb took three years, it would require an annual return of 15.0%, earned in each of those years.
Has Warner Music Stock Gained 52% In Three Years?
Measuring every rolling three-year stretch since June 2020, where each lasts 756 trading days and a new period starts every trading day, Warner Music stock has not gained 52.2% even once. The business may still do well from here. To get back to its old high within three years, however, Warner Music stock will need a bigger gain than it made in any of those stretches.
What Has Waiting Cost Warner Music Holders?
Holders who bought at the high have now waited five years. Over those years, the S&P 500 is up 67.3% before dividends, while Warner Music stock is still down 34.3%. Those holders lost more than the fall itself: they also missed the market’s rise over the same five years.
Is Warner Music The Same Business It Was Then?
No. Today, Warner Music is a larger and more profitable business than it was at its high.
| Warner Music | At the high, October 2021 | Now |
|---|---|---|
| Share price | $49.53 | $32.55 |
| Business figures: twelve months ended | 2021-09-30 | 2026-06-30 |
| Revenue, twelve months | $5,301 million | $7,304 million |
| Operating margin | 11.5% | 16.1% |
| Net income, twelve months | $304 million | $672 million |
Share prices are split-adjusted closes on October 28, 2021 and November 4, 2026. Business figures are as reported, for the twelve months to the latest fiscal quarter in our data on or before each date.
The company sells music through its Recorded Music and Music Publishing businesses. Management said subscription streaming led the growth in recorded music during fiscal Q3 2026. Over the twelve months ending June 2026, Warner Music brought in 37.8% more revenue than it did in the twelve months ending September 2021. The operating margin rose from 11.5% to 16.1% over the same years.
The business has grown while the stock has fallen, so the price in October 2021 was the unusual part, not today’s. On September 30, 2021, a month before the high, the stock traded at 72.3 times its earnings for the prior twelve months, the highest at any quarter end since mid-2020. The better question for Warner Music holders is not when the old price will return, but what today’s business is worth at today’s price of 25.3 times its past year’s earnings.
Still Holding Warner Music After The Drop?
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