Allocate Software (LSE:ALLA) Net Margin %: 19.34% (As of May. 2014) — 247% Above Median

What is Allocate Software Net Margin %?

Allocate Software LSE:ALLA Net Margin % is 19.34% as of May. 2014, which is 247% above its 10-year median of 5.57. The stock has 1 warning sign investors should review.

Net margin is calculated as Net Income divided by its Revenue. Allocate Software's Net Income for the six months ended in May. 2014 was £4.40 Mil. Allocate Software's Revenue for the six months ended in May. 2014 was £22.75 Mil. Therefore, Allocate Software's net margin for the quarter that ended in May. 2014 was 19.34%.

The historical rank and industry rank for Allocate Software's Net Margin % or its related term are showing as below:

LSE:ALLA' s Net Margin % Range Over the Past 10 Years
Min: -173.14 Med: 5.57 Max: 26.55
Current: 8.6

LSE:ALLA's Net Margin % is not ranked
in the Software industry.
Industry Median: 2.54 vs LSE:ALLA: 8.60

Allocate Software (LSE:ALLA) 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.

Allocate Software Net Margin % Related Terms

Allocate Software Net Margin % Historical Data

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The historical data trend for Allocate Software'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.

Allocate Software Net Margin % Chart

Allocate Software Annual Data

Trend

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

Net Margin %

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5.69

2.65

-9.27

-3.87

8.60

Allocate Software Semi-Annual Data
	Nov04	May05	Nov05	May06	Nov06	May07	Nov07	May08	Nov08	May09	Nov09	May10	Nov10	May11	Nov11	May12	Nov12	May13	Nov13	May14
Net Margin %	Get a 7-Day Free Trial															9.54	-13.77	3.72	-5.55	19.34

LSE:ALLA vs SREV, ASUR: Net Margin % Comparison

For the Software - Application subindustry, Allocate Software'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.

Allocate Software Net Margin % vs Software Industry

For the Software industry and Technology sector, Allocate Software's Net Margin % distribution charts can be found below:

* The bar in red indicates where Allocate Software's Net Margin % falls into.

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Allocate Software Net Margin % Calculation

Net margin - also known as net profit margin is the ratio of Net Income divided by net sales or Revenue, usually presented in percent.

Allocate Software's Net Margin for the fiscal year that ended in May. 2014 is calculated as

Net Margin	=	Net Income (A: May. 2014 )	/	Revenue (A: May. 2014 )
	=	3.44	/	40.022
	=	8.60 %

Allocate Software's Net Margin for the quarter that ended in May. 2014 is calculated as

Net Margin	=	Net Income (Q: May. 2014 )	/	Revenue (Q: May. 2014 )
	=	4.399	/	22.746
	=	19.34 %

Frequently Asked Questions Learn more about Net Margin % →

What does a Net Margin % of 19.34% mean?

Allocate Software (LSE:ALLA) has a Net Margin % of 19.34% as of May. 2014. Net margin is the ratio of total net income to net sales. View historical data on Allocate Software and its competitors. This is 247% above median its historical median of 5.57.

Is Allocate Software's Net Margin % too high?

Allocate Software's current Net Margin % of 19.34% is 247% above median its 10-year median of 5.57. The Software industry median Net Margin % is 2.54. Allocate Software's value of 19.34% is 661.4% above this industry median.

How does Allocate Software's Net Margin % compare to SREV and ASUR?

Allocate Software's Net Margin % of 19.34% can be compared against companies in the Software industry. The industry median Net Margin % is 2.54. Allocate Software's value of 19.34% is 661.4% above this benchmark. While the company's 10-year median is 5.57 vs. the industry median of 2.54, Allocate Software 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 a Software company?

The median Net Margin % among Software companies is 2.54, based on 2,827 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. Allocate Software's current Net Margin % of 19.34% is 661.4% 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 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 Allocate Software and its competitors. For the Software industry, the median Net Margin % is 2.54 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Allocate Software's current Net Margin % is 19.34%, which is 247% above median its own 10-year median of 5.57. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.

Is Allocate Software stock overvalued right now?

Allocate Software (LSE:ALLA) has a current Net Margin % of 19.34%. The current Net Margin % is 19.34%, which is 247% above median its 10-year median of 5.57 and 661.4% above the Software industry median of 2.54. 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 Allocate Software (LSE:ALLA), the current Net Margin % is 19.34% as of May. 2014. 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.

Allocate Software Business Description

Industry Technology Software

Comparable Companies LSE:OMG TSE:3653 TSE:9698 TSE:4826 TSXV:FD XTER:GKS TSE:3800 MIL:EXSY OCSE:CBRAIN TSE:3771 SREV TSE:3921 BOM:532663 XKRX:158430 IST:LOGO LSE:TRB LSE:CKT XSWX:CLXN MIL:TXT ASUR

Website http://www.allocatesoftware.com

Allocate Software PLC is engaged in the development, sale and support of workforce management solutions, and the provision of related IT services to major healthcare, defence, government and commercial customers. The business of the company is focused principally on the Healthcare market in addition to Defence. Its segments are Licence, Subscriptions, Support, and Services. Licence and Subscriptions segments represent the sale of non-cancellable software licence agreements and subscriptions associated with that software. Support and Services segments represent the provision of installation, consulting, training and product support. It operates in UK, Europe, USA and Australia.