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.
Advanced Braking Technology Operating Margin % Related Terms
Advanced Braking Technology 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.
ASX:ABV vs ORLY, AZO, BWA: Operating Margin % Comparison
For the Auto Parts subindustry, Advanced Braking Technology'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.
Advanced Braking Technology Operating Margin % vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Advanced Braking Technology's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Advanced Braking Technology'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.
Advanced Braking Technology's Operating Margin % for the fiscal year that ended in Jun. 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.
Advanced Braking Technology (ASX:ABV) has a Operating Margin % of 6.75% as of Dec. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Advanced Braking Technology and its competitors. According to the industry distribution chart, Advanced Braking Technology ranks #464 out of 1325 companies in the Vehicles & Parts industry, placing it in the top 35%.
Is Advanced Braking Technology's Operating Margin % too high?
Advanced Braking Technology's current Operating Margin % is 6.75%. The Vehicles & Parts industry median Operating Margin % is 4.86. Advanced Braking Technology's value of 6.75% is 38.9% above this industry median. Based on the distribution chart, Advanced Braking Technology ranks #464 out of 1325 companies in the Vehicles & Parts industry, which is above the industry midpoint. Overall, Advanced Braking Technology has a GF Score™ of 68/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Advanced Braking Technology's Operating Margin % compare to ORLY and AZO?
According to the Vehicles & Parts industry distribution chart, Advanced Braking Technology ranks #464 out of 1325 companies for Operating Margin %. This puts Advanced Braking Technology in the upper half of its industry. The industry median Operating Margin % is 4.86. Advanced Braking Technology's value of 6.75% is 38.9% 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 Operating Margin % for a Vehicles & Parts company?
The median Operating Margin % among Vehicles & Parts companies is 4.86, based on 1,325 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. Advanced Braking Technology's current Operating Margin % of 6.75% is 38.9% 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 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 Advanced Braking Technology and its competitors. For the Vehicles & Parts industry, the median Operating Margin % is 4.86 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Advanced Braking Technology's current Operating Margin % is 6.75%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Advanced Braking Technology stock overvalued right now?
Based on GuruFocus' analysis, Advanced Braking Technology (ASX:ABV) is currently considered Fairly Valued. The stock's GF Value™ is A$0.11, compared to a current price of A$0.11 — trading 4.5% below its estimated fair value. The current Operating Margin % is 6.75% and 38.9% above the Vehicles & Parts industry median of 4.86. Advanced Braking Technology's overall GF Score™ is 68/100 with 2 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 Advanced Braking Technology (ASX:ABV), the current Operating Margin % is 6.75% 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 Advanced Braking Technology (ASX:ABV) Overvalued in 2026?
Based on GuruFocus' analysis, Advanced Braking Technology stock appears to be undervalued.
The current stock price of A$0.11 is trading 4.5% below its estimated GF Value™ of A$0.11.
GuruFocus considers Advanced Braking Technology to be Fairly Valued.
Key valuation signals for ASX:ABV:
Operating Margin %: 6.75%
GF Value™: A$0.11 vs. price of A$0.11 (4.5% below fair value)
Industry Position: 38.9% above the Vehicles & Parts median (#464 of 1325)
No single metric tells the full story. See the ASX:ABV stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Advanced Braking Technology Ltd is an Australian firm engaged in the commercialization, research, development, and manufacture of the ABT Failsafe Brakes, ABT Failsafe Emergency Driveline Brakes, Terra Dura Brakes, and associated braking systems. It develops its product portfolio for a diverse range of industries such as mining, defense, civil construction, and waste management industries.
68GF Score
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