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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.
Sonoma Pharmaceuticals Operating Margin % Related Terms
Sonoma Pharmaceuticals Operating Margin % Historical Data
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The historical data trend for Sonoma Pharmaceuticals's Operating 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.
FRA:O8Z vs YCBD, CVSI, AKAN: Operating Margin % Comparison
For the Drug Manufacturers - Specialty & Generic subindustry, Sonoma Pharmaceuticals'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.
Sonoma Pharmaceuticals Operating Margin % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Sonoma Pharmaceuticals's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Sonoma Pharmaceuticals'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.
Sonoma Pharmaceuticals's Operating Margin % for the fiscal year that ended in Mar. 2026 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.
Sonoma Pharmaceuticals (FRA:O8Z) has a Operating Margin % of -6.32% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Sonoma Pharmaceuticals and its competitors. According to the industry distribution chart, Sonoma Pharmaceuticals ranks #771 out of 960 companies in the Drug Manufacturers industry, placing it in the top 80.3%.
Is Sonoma Pharmaceuticals' Operating Margin % too high?
Sonoma Pharmaceuticals' current Operating Margin % is -6.32%. Based on the distribution chart, Sonoma Pharmaceuticals ranks #771 out of 960 companies in the Drug Manufacturers industry, which is in the bottom quartile relative to peers. Overall, Sonoma Pharmaceuticals has a GF Score™ of 34/100, reflecting its overall financial health beyond just this single metric.
How does Sonoma Pharmaceuticals' Operating Margin % compare to YCBD and CVSI?
According to the Drug Manufacturers industry distribution chart, Sonoma Pharmaceuticals ranks #771 out of 960 companies for Operating Margin %. This places Sonoma Pharmaceuticals in the lower half of its industry. The industry median Operating Margin % is 7.58. 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 960 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. 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 Sonoma Pharmaceuticals 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. Sonoma Pharmaceuticals's current Operating Margin % is -6.32%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sonoma Pharmaceuticals stock overvalued right now?
Sonoma Pharmaceuticals (FRA:O8Z) has a current Operating Margin % of -6.32%. The stock's GF Value™ is €6.04, compared to a current price of €2.72 — trading 55% below its estimated fair value. The current Operating Margin % is -6.32%. Sonoma Pharmaceuticals' overall GF Score™ is 34/100 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 Sonoma Pharmaceuticals (FRA:O8Z), the current Operating Margin % is -6.32% 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 Sonoma Pharmaceuticals (FRA:O8Z) Overvalued in 2026?
Based on GuruFocus' analysis, Sonoma Pharmaceuticals stock appears to be undervalued.
The current stock price of €2.72 is trading 55% below its estimated GF Value™ of €6.04.
Key valuation signals for FRA:O8Z:
Operating Margin %: -6.32%
GF Value™: €6.04 vs. price of €2.72 (55% below fair value)
No single metric tells the full story. See the FRA:O8Z stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sonoma Pharmaceuticals Inc is a specialty pharmaceutical company operating in the United States. It is engaged in identifying, developing, and commercializing differentiated therapies for patients living with chronic skin conditions. The company focuses on the development and commercialization of therapeutic solutions in medical dermatology to treat skin conditions, such as acne, atopic dermatitis, and scarring. The key products of the company are Celacyn, Ceramax Skin Barrier Cream, Mondoxyne, Alevicyn, SebuDerm, Microcyn, and Microcyn which are available for various skin treatments such as scars, itchy skin, minor skin irritations, rashes, and others. The company derives revenue from the sale of products in the United States, Latin America, Europe, Asia, and other countries.
34GF 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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