Since UMG’s IPO on Sep 21, UMG is up 0.9% while WMG is up 7.6%
When discussing UMG’s potential valuation prior to the IPO, investors were all using WMG as a reference
The debate was about the premium at which UMG would be trading
Well, UMG core business (excluding stakes in Vevo, SPOT and TME) is now trading at an 8% discount to WMG’s multiple as UMG has not enjoyed the same performance as WMG lately
UMG has now released its first set of results and there is a decent consensus on its EBITDA 21E so we should not expect any surprises (the lowest estimate of €1,777 is 2.4% below the mean of €1,820 used in my calculations)
UMG should catch up to WMG’s valuation at some point
