Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.
Be Aware
Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).
If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.
For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokias Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).
Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.
Ascend Wellness Holdings Operating Margin % Related Terms
Ascend Wellness Holdings Operating Margin % Historical Data
* 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 Drug Manufacturers - Specialty & Generic subindustry, Ascend Wellness Holdings's Operating Margin %, along with its competitors' market caps and Operating 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.
Ascend Wellness Holdings Operating Margin % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Ascend Wellness Holdings's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Ascend Wellness Holdings's Operating Margin % falls into.
Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.
Ascend Wellness Holdings's Operating Margin % for the fiscal year that ended in Dec. 2025 is calculated as
* 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.
Ascend Wellness Holdings (AAWH) has a Operating Margin % of 2.06% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Ascend Wellness Holdings and its competitors. According to the industry distribution chart, Ascend Wellness Holdings ranks #674 out of 952 companies in the Drug Manufacturers industry, placing it in the top 70.8%.
Is Ascend Wellness Holdings' Operating Margin % too high?
Ascend Wellness Holdings' current Operating Margin % is 2.06%. The Drug Manufacturers industry median Operating Margin % is 7.58. Ascend Wellness Holdings' value of 2.06% is 72.8% below this industry median. Based on the distribution chart, Ascend Wellness Holdings ranks #674 out of 952 companies in the Drug Manufacturers industry, which is below the industry midpoint. Overall, Ascend Wellness Holdings has a GF Score™ of 42/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Ascend Wellness Holdings' Operating Margin % compare to ZTS?
According to the Drug Manufacturers industry distribution chart, Ascend Wellness Holdings ranks #674 out of 952 companies for Operating Margin %. This places Ascend Wellness Holdings in the lower half of its industry. The industry median Operating Margin % is 7.58. Ascend Wellness Holdings' value of 2.06% is 72.8% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Operating Margin % for a Drug Manufacturers company?
The median Operating Margin % among Drug Manufacturers companies is 7.58, based on 952 companies in the industry. Companies in the top quartile (top 25%) have a Operating Margin % significantly above this median, while those in the bottom quartile fall well below. However, Operating Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Ascend Wellness Holdings's current Operating Margin % of 2.06% is 72.8% below 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 Operating Margin % mean?
A high Operating Margin % can signal that a stock is expensive relative to its fundamentals. Operating margin is the ratio of total operating income to net sales. View historical data on Ascend Wellness Holdings and its competitors. For the Drug Manufacturers industry, the median Operating Margin % is 7.58 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Ascend Wellness Holdings's current Operating Margin % is 2.06%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Ascend Wellness Holdings stock overvalued right now?
Based on GuruFocus' analysis, Ascend Wellness Holdings (AAWH) is currently considered Possible Value Trap. The stock's GF Value™ is $0.64, compared to a current price of $0.47 — trading 26.9% below its estimated fair value. The current Operating Margin % is 2.06% and 72.8% below the Drug Manufacturers industry median of 7.58. Ascend Wellness Holdings' overall GF Score™ is 42/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Operating Margin % calculated?
Operating Margin % is calculated from a company's financial statements. For Ascend Wellness Holdings (AAWH), the current Operating Margin % is 2.06% as of Mar. 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 Ascend Wellness Holdings (AAWH) Overvalued in 2026?
Based on GuruFocus' analysis, Ascend Wellness Holdings stock appears to be undervalued.
The current stock price of $0.47 is trading 26.9% below its estimated GF Value™ of $0.64.
GuruFocus considers Ascend Wellness Holdings to be Possible Value Trap.
Key valuation signals for AAWH:
Operating Margin %: 2.06%
GF Value™: $0.64 vs. price of $0.47 (26.9% below fair value)
Industry Position: 72.8% below the Drug Manufacturers median (#674 of 952)
No single metric tells the full story. See the AAWH stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Ascend Wellness Holdings Inc is a vertically integrated multi-state operator focused on adult-use or near-term adult-use cannabis states in limited licenses markets. The company's core business is the cultivation, manufacturing, and distribution of cannabis consumer packaged goods, which it sells through company-owned retail stores and third-party licensed cannabis retail stores. It generates maximum revenue from the retail product segment.
42GF Score
Get the complete analysis for AAWH
Operating Margin % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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