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One week ago, Warner Music Group (WMG) returned to the stock market in a big way, with investors pushing its per-share value up by more than 20 percent – and adding almost $400 million to its market cap – in a single day. But how has the Big Three record label’s public offering fared in the interim?
Stated concisely, Warner Music Group’s market performance has been generally solid in the meantime.
It appears that the first couple days’ tremendous gains resulted chiefly from the market’s eagerness to secure a piece of a major brand that operates in a highly lucrative industry – one that, to be sure, generated more than $75 billion in 2019, and that experts anticipate will bounce back from the COVID-19 shakeup.
In other words, WMG’s consistency during its first week on the market is probably indicative of investors’ confidence in the music industry’s long-term performance – a point that bodes well for artists and professionals.
At the time of this writing, the company’s per-share price was hovering around $31, up from $25 out-of-the-gate last Wednesday. At their lowest point during the last seven days, Warner Music Group shares touched $26.99 apiece, following an initial influx in purchases and a corresponding selloff as prices climbed.
Since then, however, WMG’s stock has largely held steady, having last dipped below the $30 mark (and barely doing so at that) early yesterday morning.
Thus far, the two highest-profile rumors surrounding WMG’s stock-market return have yet to come to fruition: The Kingdom of Saudi Arabia has not moved to acquire a substantial portion of its shares, nor has Chinese conglomerate Tencent.
Tencent closed a $3.37 billion deal with Universal Music Group parent company Vivendi earlier this year, in exchange for a 10 percent stake in the mega-label. Saudi Arabia, for its part, invested $500 million to claim a 5.7 percent stake in leading concert promoter Live Nation.