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Diamondrock Hospitality CoFRA:HBO +2.70%65 Operating Margin % is 23.04% as of Jun. 2026, which is 74% above its 10-year median of 13.21. GuruFocus rates FRA:HBO with a GF Score™ of 65/100 and a GF Value™ of €7.93 (Significantly Overvalued). The stock has 8 warning signs investors should review. Among 735 REITs companies, Diamondrock Hospitality Co ranks worse than 84.35% on this metric.
Diamondrock Hospitality Co (FRA:HBO) Operating Margin % Explanation
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.
Diamondrock Hospitality Co Operating Margin % Related Terms
Diamondrock Hospitality Co 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.
Diamondrock Hospitality Co Operating Margin % Chart
FRA:HBO vs PK, SHO, PEB: Operating Margin % Comparison
For the REIT - Hotel & Motel subindustry, Diamondrock Hospitality Co'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.
Diamondrock Hospitality Co Operating Margin % vs REITs Industry
For the REITs industry and Real Estate sector, Diamondrock Hospitality Co's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Diamondrock Hospitality Co's Operating Margin % falls into.
Diamondrock Hospitality Co Operating Margin % Calculation
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.
Diamondrock Hospitality Co'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.
Diamondrock Hospitality Co (FRA:HBO) has a Operating Margin % of 23.04% as of Jun. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Diamondrock Hospitality Co and its competitors. This is 74% above median its historical median of 13.21. According to the industry distribution chart, Diamondrock Hospitality Co ranks #620 out of 735 companies in the REITs industry, placing it in the top 84.4%.
Is Diamondrock Hospitality Co's Operating Margin % too high?
Diamondrock Hospitality Co's current Operating Margin % of 23.04% is 74% above median its 10-year median of 13.21. The REITs industry median Operating Margin % is 52.58. Diamondrock Hospitality Co's value of 23.04% is 56.2% below this industry median. Based on the distribution chart, Diamondrock Hospitality Co ranks #620 out of 735 companies in the REITs industry, which is in the bottom quartile relative to peers. Overall, Diamondrock Hospitality Co has a GF Score™ of 65/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Diamondrock Hospitality Co's Operating Margin % compare to PK and SHO?
According to the REITs industry distribution chart, Diamondrock Hospitality Co ranks #620 out of 735 companies for Operating Margin %. This places Diamondrock Hospitality Co in the lower half of its industry. The industry median Operating Margin % is 52.58. Diamondrock Hospitality Co's value of 23.04% is 56.2% below this benchmark. While the company's 10-year median is 13.21 vs. the industry median of 52.58, Diamondrock Hospitality Co has consistently been below 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 Operating Margin % for a REITs company?
The median Operating Margin % among REITs companies is 52.58, based on 735 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. Diamondrock Hospitality Co's current Operating Margin % of 23.04% is 56.2% 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 Diamondrock Hospitality Co and its competitors. For the REITs industry, the median Operating Margin % is 52.58 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Diamondrock Hospitality Co's current Operating Margin % is 23.04%, which is 74% above median its own 10-year median of 13.21. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Diamondrock Hospitality Co stock overvalued right now?
Based on GuruFocus' analysis, Diamondrock Hospitality Co (FRA:HBO) is currently considered Significantly Overvalued. The stock's GF Value™ is €7.93, compared to a current price of €11.40 — trading 43.8% above its estimated fair value. The current Operating Margin % is 23.04%, which is 74% above median its 10-year median of 13.21 and 56.2% below the REITs industry median of 52.58. Diamondrock Hospitality Co's overall GF Score™ is 65/100 with 8 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 Diamondrock Hospitality Co (FRA:HBO), the current Operating Margin % is 23.04% 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 Diamondrock Hospitality Co (FRA:HBO) Overvalued in 2026?
Based on GuruFocus' analysis, Diamondrock Hospitality Co stock appears to be overvalued.
The current stock price of €11.40 is trading 43.8% above its estimated GF Value™ of €7.93.
GuruFocus considers Diamondrock Hospitality Co to be Significantly Overvalued.
Key valuation signals for FRA:HBO:
Operating Margin %: 23.04% (74% above median its 10-year median of 13.21)
GF Value™: €7.93 vs. price of €11.40 (43.8% above fair value)
Industry Position: 56.2% below the REITs median (#620 of 735)
No single metric tells the full story. See the FRA:HBO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Diamondrock Hospitality Company is a real estate investment trust that owns lodging properties. Its business is to acquire, own, manage, and renovate full-service hotel properties in the United States. It operates in cities such as Chicago, Boston, New York, Denver, and others. Within DiamondRock's holdings, the majority of the hotel brands include Marriott, Starwood, and Hilton. The company operates in one reportable segment: The hotel ownership segment, which is comprised of upper upscale and luxury chain scale hotels that offer hotel rooms, food and beverage and other ancillary guest services.
65GF Score
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Operating Margin % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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