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Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue.
LSI Industries's Degree of Operating Leverage for the quarter that ended in Jun. 2026 was 2.76. The higher Degree of Operating Leverage, the higher operating risk the company will take.
The industry rank for LSI Industries's Degree of Operating Leverage or its related term are showing as below:
FRA:LS2's Degree of Operating Leverage is ranked worse than 66.24% of 2438
companies
in the Hardware industry
Industry Median: 1.085
vs FRA:LS2: 2.76
LSI Industries (FRA:LS2) 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.
LSI Industries Degree of Operating Leverage Related Terms
LSI Industries Degree of Operating Leverage Historical Data
* Premium members only.
The historical data trend for LSI Industries'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.
FRA:LS2 vs LPTH, MEI, KOPN: Degree of Operating Leverage Comparison
For the Electronic Components subindustry, LSI Industries'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.
LSI Industries Degree of Operating Leverage vs Hardware Industry
For the Hardware industry and Technology sector, LSI Industries's Degree of Operating Leverage distribution charts can be found below:
* The bar in red indicates where LSI Industries'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 2.76 mean?
LSI Industries (FRA:LS2) has a Degree of Operating Leverage of 2.76 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 LSI Industries and its competitors. According to the industry distribution chart, LSI Industries ranks #1615 out of 2438 companies in the Hardware industry, placing it in the top 66.2%.
Is LSI Industries' Degree of Operating Leverage too high?
LSI Industries' current Degree of Operating Leverage is 2.76. The Hardware industry median Degree of Operating Leverage is 1.09. LSI Industries' value of 2.76 is 154.4% above this industry median. Based on the distribution chart, LSI Industries ranks #1615 out of 2438 companies in the Hardware industry, which is below the industry midpoint. Overall, LSI Industries has a GF Score™ of 87/100, reflecting its overall financial health beyond just this single metric.
How does LSI Industries' Degree of Operating Leverage compare to LPTH and MEI?
According to the Hardware industry distribution chart, LSI Industries ranks #1615 out of 2438 companies for Degree of Operating Leverage. This places LSI Industries in the lower half of its industry. The industry median Degree of Operating Leverage is 1.09. LSI Industries' value of 2.76 is 154.4% 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 Hardware company?
The median Degree of Operating Leverage among Hardware companies is 1.09, based on 2,438 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. LSI Industries's current Degree of Operating Leverage of 2.76 is 154.4% 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 LSI Industries and its competitors. For the Hardware industry, the median Degree of Operating Leverage is 1.09 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. LSI Industries's current Degree of Operating Leverage is 2.76. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is LSI Industries stock overvalued right now?
LSI Industries (FRA:LS2) has a current Degree of Operating Leverage of 2.76. The stock's GF Value™ is €21.39, compared to a current price of €20.20 — trading 5.6% below its estimated fair value. The current Degree of Operating Leverage is 2.76 and 154.4% above the Hardware industry median of 1.09. LSI Industries' overall GF Score™ is 87/100 with 3 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 LSI Industries (FRA:LS2), the current Degree of Operating Leverage is 2.76 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 LSI Industries (FRA:LS2) Overvalued in 2026?
Based on GuruFocus' analysis, LSI Industries stock appears to be undervalued.
The current stock price of €20.20 is trading 5.6% below its estimated GF Value™ of €21.39.
Key valuation signals for FRA:LS2:
Degree of Operating Leverage: 2.76
GF Value™: €21.39 vs. price of €20.20 (5.6% below fair value)
Industry Position: 154.4% above the Hardware median (#1615 of 2438)
No single metric tells the full story. See the FRA:LS2 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
LSI Industries Inc provides corporate visual image solutions to the petroleum and convenience store industry. The company's operating segments include Lighting and Display Solutions. It generates maximum revenue from the Display solutions segment. Lighting Segment manufactures and markets outdoor and indoor lighting and lighting controls for the commercial, industrial, and multi-site retail markets, including the petroleum/convenience store, quick-service, and automotive markets. The Display Solutions Segment manufactures, sells, and installs exterior and interior visual image and display elements, including printed graphics, structural graphics, digital signage, menu board systems, display fixtures, refrigerated displays, and custom display elements.
87GF Score
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