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Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue.
Active Fine Chemicals's Degree of Operating Leverage for the quarter that ended in Mar. 2023 was 0.00. The higher Degree of Operating Leverage, the higher operating risk the company will take.
The industry rank for Active Fine Chemicals's Degree of Operating Leverage or its related term are showing as below:
DHA:ACTIVEFINE's Degree of Operating Leverage is not ranked *
in the Chemicals industry.
Industry Median: 1.32 * Ranked among companies with meaningful Degree of Operating Leverage only.
Active Fine Chemicals (DHA:ACTIVEFINE) 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.
Active Fine Chemicals Degree of Operating Leverage Related Terms
Active Fine Chemicals Degree of Operating Leverage Historical Data
* Premium members only.
The historical data trend for Active Fine Chemicals'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.
Active Fine Chemicals Degree of Operating Leverage Chart
DHA:ACTIVEFINE vs DOW, CE: Degree of Operating Leverage Comparison
For the Chemicals subindustry, Active Fine Chemicals'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.
Active Fine Chemicals Degree of Operating Leverage vs Chemicals Industry
For the Chemicals industry and Basic Materials sector, Active Fine Chemicals's Degree of Operating Leverage distribution charts can be found below:
* The bar in red indicates where Active Fine Chemicals'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 0.00 mean?
Active Fine Chemicals (DHA:ACTIVEFINE) has a Degree of Operating Leverage of 0.00 as of Mar. 2023. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for Active Fine Chemicals and its competitors.
Is Active Fine Chemicals' Degree of Operating Leverage too high?
Active Fine Chemicals' current Degree of Operating Leverage is 0.00. Overall, Active Fine Chemicals has a GF Score™ of 10/100, reflecting its overall financial health beyond just this single metric.
How does Active Fine Chemicals' Degree of Operating Leverage compare to DOW and CE?
Active Fine Chemicals' Degree of Operating Leverage of 0.00 can be compared against companies in the Chemicals industry. The industry median Degree of Operating Leverage is 1.32. 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 Chemicals company?
The median Degree of Operating Leverage among Chemicals companies is 1.32, based on 1,560 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. 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 Active Fine Chemicals and its competitors. For the Chemicals industry, the median Degree of Operating Leverage is 1.32 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Active Fine Chemicals's current Degree of Operating Leverage is 0.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Active Fine Chemicals stock overvalued right now?
Active Fine Chemicals (DHA:ACTIVEFINE) has a current Degree of Operating Leverage of 0.00. The current Degree of Operating Leverage is 0.00. Active Fine Chemicals' overall GF Score™ is 10/100. 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 Active Fine Chemicals (DHA:ACTIVEFINE), the current Degree of Operating Leverage is 0.00 as of Mar. 2023. 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.
Active Fine Chemicals Ltd is a Bangladesh based chemical company engaged in manufacturing active pharmaceutical ingredients and laboratory reagents. Its product offerings include azithromycin dihydrate, erythromycin ethyl succinate, erythromycin stearate, pantoprazole sodium sesquihydrate, venlafaxine HCL, sitagliptin phosphate monohydrate, and pregabalin. While it also manufactures laboratory reagents including HPLC Grade solvents, solvents, and powder reagents.
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Degree of Operating Leverage is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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