BAE SystemsBAESY -0.59%86 Net Margin % is 7.40% as of Dec. 2025, which is 1% above its 10-year median of 7.36. GuruFocus rates BAESY with a GF Score™ of 86/100 and a GF Value™ of $88.08 (Fairly Valued). The stock has 2 warning signs investors should review. Among 347 Aerospace & Defense companies, BAE Systems ranks better than 61.1% on this metric.
Net margin is calculated as Net Income divided by its Revenue. BAE Systems's Net Income for the
six
months ended in Dec. 2025 was $1,463 Mil. BAE Systems's Revenue for the
six
months ended in Dec. 2025 was $19,766 Mil. Therefore, BAE Systems's net margin for the quarter that ended in Dec. 2025 was 7.40%.
The historical rank and industry rank for BAE Systems's Net Margin % or its related term are showing as below:
BAESY'
s Net Margin % Range Over the Past 10 Years
Min: 4.8 Med: 7.36 Max: 9.01
Current: 7.28
BAESY's Net Margin % is ranked better than 61.1% of 347
companies
in the Aerospace & Defense industry
Industry Median: 4.9
vs BAESY: 7.28
BAE Systems (OTCPK:BAESY) Net Margin % Explanation
Although Net Income and Earnings-per-Share (EPS) are the most widely used parameter in measuring a company's profitability and valuation, it is the least reliable. The reason is that reported earnings can be manipulated easily by adjusting any numbers such as Depreciation, Depletion and Amotorization and non-recurring items.
But the long term trend of the net margin is a good indicator of the competitiveness and health of the business.
BAE Systems Net Margin % Related Terms
BAE Systems Net Margin % Historical Data
* Premium members only.
The historical data trend for BAE Systems's Net Margin % 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.
For the Aerospace & Defense subindustry, BAE Systems's Net Margin %, along with its competitors' market caps and Net Margin % 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.
BAE Systems Net Margin % vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, BAE Systems's Net Margin % distribution charts can be found below:
* The bar in red indicates where BAE Systems's Net Margin % 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.
BAE Systems (BAESY) has a Net Margin % of 7.40% as of Dec. 2025. Net margin is the ratio of total net income to net sales. View historical data on BAE Systems and its competitors. This is near median its historical median of 7.36. Over the past decade, BAE Systems' Net Margin % has ranged from 4.80 to 9.01. According to the industry distribution chart, BAE Systems ranks #135 out of 347 companies in the Aerospace & Defense industry, placing it in the top 38.9%.
Is BAE Systems' Net Margin % too high?
BAE Systems' current Net Margin % of 7.40% is near median its 10-year median of 7.36. Over the past 10 years, this metric has ranged from a low of 4.80 to a high of 9.01. The Aerospace & Defense industry median Net Margin % is 4.90. BAE Systems' value of 7.40% is 51% above this industry median. Based on the distribution chart, BAE Systems ranks #135 out of 347 companies in the Aerospace & Defense industry, which is above the industry midpoint. Overall, BAE Systems has a GF Score™ of 86/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does BAE Systems' Net Margin % compare to GE and RTX?
According to the Aerospace & Defense industry distribution chart, BAE Systems ranks #135 out of 347 companies for Net Margin %. This puts BAE Systems in the upper half of its industry. The industry median Net Margin % is 4.90. BAE Systems' value of 7.40% is 51% above this benchmark. Historically, BAE Systems' own Net Margin % has ranged from 4.80 to 9.01 over the past decade. While the company's 10-year median is 7.36 vs. the industry median of 4.90, BAE Systems has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Net Margin % for an Aerospace & Defense company?
The median Net Margin % among Aerospace & Defense companies is 4.90, based on 347 companies in the industry. Companies in the top quartile (top 25%) have a Net Margin % significantly above this median, while those in the bottom quartile fall well below. However, Net Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. BAE Systems's current Net Margin % of 7.40% is 51% 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 Net Margin % mean?
A high Net Margin % can signal that a stock is expensive relative to its fundamentals. Net margin is the ratio of total net income to net sales. View historical data on BAE Systems and its competitors. For the Aerospace & Defense industry, the median Net Margin % is 4.90 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. BAE Systems's current Net Margin % is 7.40%, which is near median its own 10-year median of 7.36. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is BAE Systems stock overvalued right now?
Based on GuruFocus' analysis, BAE Systems (BAESY) is currently considered Fairly Valued. The stock's GF Value™ is $88.08, compared to a current price of $95.60 — trading 8.5% above its estimated fair value. The current Net Margin % is 7.40%, which is near median its 10-year median of 7.36 and 51% above the Aerospace & Defense industry median of 4.90. BAE Systems' overall GF Score™ is 86/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Net Margin % calculated?
Net Margin % is calculated from a company's financial statements. For BAE Systems (BAESY), the current Net Margin % is 7.40% as of Dec. 2025. 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 BAE Systems (BAESY) Overvalued in 2026?
Based on GuruFocus' analysis, BAE Systems stock appears to be overvalued.
The current stock price of $95.60 is trading 8.5% above its estimated GF Value™ of $88.08.
GuruFocus considers BAE Systems to be Fairly Valued.
Key valuation signals for BAESY:
Net Margin %: 7.40% (near median its 10-year median of 7.36)
GF Value™: $88.08 vs. price of $95.60 (8.5% above fair value)
Industry Position: 51% above the Aerospace & Defense median (#135 of 347)
No single metric tells the full story. See the BAESY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
BAE Systems is a British global defense, security, and aerospace company and the largest defense contractor in Europe; it is one of six prime contractors to the US Department of Defense. For reporting purposes, the company has five operating segments: electronics systems is the group's US- and UK-based electronic warfare systems; the cyber, security, and intelligence segment supplies intelligence and security solutions to the US government; platforms and services manufactures combat vehicles and munitions and performs ship repair services to the US Defense Department; the air segment includes BAE's share of US and European air programs as well as its businesses in Saudi Arabia and Australia, and the maritime segment comprises UK land- and marine-based activities.
86GF Score
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