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Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue.
McMillan Shakespeare's Degree of Operating Leverage for the quarter that ended in Jun. 2026 was 1.62. The higher Degree of Operating Leverage, the higher operating risk the company will take.
The industry rank for McMillan Shakespeare's Degree of Operating Leverage or its related term are showing as below:
ASX:MMS's Degree of Operating Leverage is ranked worse than 58.33% of 1044
companies
in the Business Services industry
Industry Median: 1.105
vs ASX:MMS: 1.62
McMillan Shakespeare (ASX:MMS) Degree of Operating Leverage Explanation
Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.
A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.
Be Aware
The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.
McMillan Shakespeare Degree of Operating Leverage Related Terms
McMillan Shakespeare Degree of Operating Leverage Historical Data
* Premium members only.
The historical data trend for McMillan Shakespeare's Degree of Operating Leverage can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
McMillan Shakespeare Degree of Operating Leverage Chart
ASX:MMS vs RHI, KFY, TNET: Degree of Operating Leverage Comparison
For the Staffing & Employment Services subindustry, McMillan Shakespeare's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
McMillan Shakespeare Degree of Operating Leverage vs Business Services Industry
For the Business Services industry and Industrials sector, McMillan Shakespeare's Degree of Operating Leverage distribution charts can be found below:
* The bar in red indicates where McMillan Shakespeare's Degree of Operating Leverage falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.
What does a Degree of Operating Leverage of 1.62 mean?
McMillan Shakespeare (ASX:MMS) has a Degree of Operating Leverage of 1.62 as of Jun. 2026. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for McMillan Shakespeare and its competitors. According to the industry distribution chart, McMillan Shakespeare ranks #609 out of 1044 companies in the Business Services industry, placing it in the top 58.3%.
Is McMillan Shakespeare's Degree of Operating Leverage too high?
McMillan Shakespeare's current Degree of Operating Leverage is 1.62. The Business Services industry median Degree of Operating Leverage is 1.11. McMillan Shakespeare's value of 1.62 is 46.6% above this industry median. Based on the distribution chart, McMillan Shakespeare ranks #609 out of 1044 companies in the Business Services industry, which is below the industry midpoint. Overall, McMillan Shakespeare has a GF Score™ of 75/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does McMillan Shakespeare's Degree of Operating Leverage compare to RHI and KFY?
According to the Business Services industry distribution chart, McMillan Shakespeare ranks #609 out of 1044 companies for Degree of Operating Leverage. This places McMillan Shakespeare in the lower half of its industry. The industry median Degree of Operating Leverage is 1.11. McMillan Shakespeare's value of 1.62 is 46.6% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Degree of Operating Leverage for a Business Services company?
The median Degree of Operating Leverage among Business Services companies is 1.11, based on 1,044 companies in the industry. Companies in the top quartile (top 25%) have a Degree of Operating Leverage significantly above this median, while those in the bottom quartile fall well below. However, Degree of Operating Leverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. McMillan Shakespeare's current Degree of Operating Leverage of 1.62 is 46.6% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Degree of Operating Leverage mean?
A high Degree of Operating Leverage can signal that a stock is expensive relative to its fundamentals. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for McMillan Shakespeare and its competitors. For the Business Services industry, the median Degree of Operating Leverage is 1.11 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. McMillan Shakespeare's current Degree of Operating Leverage is 1.62. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is McMillan Shakespeare stock overvalued right now?
Based on GuruFocus' analysis, McMillan Shakespeare (ASX:MMS) is currently considered Fairly Valued. The stock's GF Value™ is A$19.91, compared to a current price of A$20.00 — trading 0.5% above its estimated fair value. The current Degree of Operating Leverage is 1.62 and 46.6% above the Business Services industry median of 1.11. McMillan Shakespeare's overall GF Score™ is 75/100 with 11 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Degree of Operating Leverage calculated?
Degree of Operating Leverage is calculated from a company's financial statements. For McMillan Shakespeare (ASX:MMS), the current Degree of Operating Leverage is 1.62 as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is McMillan Shakespeare (ASX:MMS) Overvalued in 2026?
Based on GuruFocus' analysis, McMillan Shakespeare stock appears to be overvalued.
The current stock price of A$20.00 is trading 0.5% above its estimated GF Value™ of A$19.91.
GuruFocus considers McMillan Shakespeare to be Fairly Valued.
Key valuation signals for ASX:MMS:
Degree of Operating Leverage: 1.62
GF Value™: A$19.91 vs. price of A$20.00 (0.5% above fair value)
Industry Position: 46.6% above the Business Services median (#609 of 1044)
No single metric tells the full story. See the ASX:MMS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
McMillan Shakespeare is a provider of salary packaging, novated leasing, disability plan management and support co-ordination, and fleet management services. It actively works to cross-sell its products to clients, for example, selling its salary packaging services to its fleet management customers in Australia and New Zealand. McMillan dominates Australia's salary packaging market together with Smartgroup (also covered by Morningstar), and is also a large provider of novated leasing services by volumes—together with Smartgroup and SG Fleet. The group has three operating segments: group remuneration services, asset management services, and plan and support services. Most of the group's revenue is generated from the group remuneration services segment.
75GF Score
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