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Zip CoFRA:YRRA +8.55%72 Operating Margin % is 26.47% as of Dec. 2025. GuruFocus rates FRA:YRRA with a GF Score™ of 72/100 and a GF Value™ of €1.27 (Modestly Overvalued). The stock has 7 warning signs investors should review. Among 416 Credit Services companies, Zip Co ranks better than 61.78% on this metric.
Operating Margin % is calculated as Operating Income divided by its Revenue. Zip Co's Operating Income for the
six
months ended in Dec. 2025 was €98.8 Mil. Zip Co's Revenue for the
six
months ended in Dec. 2025 was €373.4 Mil. Therefore, Zip Co's Operating Margin % for the quarter that ended in Dec. 2025 was 26.47%.
The historical rank and industry rank for Zip Co's Operating Margin % or its related term are showing as below:
FRA:YRRA'
s Operating Margin % Range Over the Past 10 Years
Min: -136.61 Med: -17.43 Max: 27.41
Current: 27.41
FRA:YRRA's Operating Margin % is ranked better than 61.78% of 416
companies
in the Credit Services industry
Industry Median: 17.325
vs FRA:YRRA: 27.41
Zip Co's 5-Year Average Operating Margin % Growth Rate was 0.00% per year.
Zip Co's Operating Income for the
six
months ended in Dec. 2025 was €98.8 Mil.
Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2025 was €189.4 Mil.
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.
Zip Co Operating Margin % Related Terms
Zip Co Operating Margin % Historical Data
* Premium members only.
The historical data trend for Zip Co'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:YRRA vs V, MA, AXP: Operating Margin % Comparison
For the Credit Services subindustry, Zip 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.
Zip Co Operating Margin % vs Credit Services Industry
For the Credit Services industry and Financial Services sector, Zip Co's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Zip Co'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.
Zip Co'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.
Zip Co (FRA:YRRA) has a Operating Margin % of 26.47% as of Dec. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Zip Co and its competitors. According to the industry distribution chart, Zip Co ranks #159 out of 416 companies in the Credit Services industry, placing it in the top 38.2%.
Is Zip Co's Operating Margin % too high?
Zip Co's current Operating Margin % is 26.47%. The Credit Services industry median Operating Margin % is 17.33. Zip Co's value of 26.47% is 52.8% above this industry median. Based on the distribution chart, Zip Co ranks #159 out of 416 companies in the Credit Services industry, which is above the industry midpoint. Overall, Zip Co has a GF Score™ of 72/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Zip Co's Operating Margin % compare to V and MA?
According to the Credit Services industry distribution chart, Zip Co ranks #159 out of 416 companies for Operating Margin %. This puts Zip Co in the upper half of its industry. The industry median Operating Margin % is 17.33. Zip Co's value of 26.47% is 52.8% 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 Credit Services company?
The median Operating Margin % among Credit Services companies is 17.33, based on 416 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. Zip Co's current Operating Margin % of 26.47% is 52.8% 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 Zip Co and its competitors. For the Credit Services industry, the median Operating Margin % is 17.33 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Zip Co's current Operating Margin % is 26.47%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Zip Co stock overvalued right now?
Based on GuruFocus' analysis, Zip Co (FRA:YRRA) is currently considered Modestly Overvalued. The stock's GF Value™ is €1.27, compared to a current price of €1.51 — trading 18.9% above its estimated fair value. The current Operating Margin % is 26.47% and 52.8% above the Credit Services industry median of 17.33. Zip Co's overall GF Score™ is 72/100 with 7 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 Zip Co (FRA:YRRA), the current Operating Margin % is 26.47% 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 Zip Co (FRA:YRRA) Overvalued in 2026?
Based on GuruFocus' analysis, Zip Co stock appears to be overvalued.
The current stock price of €1.51 is trading 18.9% above its estimated GF Value™ of €1.27.
GuruFocus considers Zip Co to be Modestly Overvalued.
Key valuation signals for FRA:YRRA:
Operating Margin %: 26.47%
GF Value™: €1.27 vs. price of €1.51 (18.9% above fair value)
Industry Position: 52.8% above the Credit Services median (#159 of 416)
No single metric tells the full story. See the FRA:YRRA stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Zip is a credit provider operating two segments: Australia and New Zealand, and the US. Founded in Australia in 2013, it has over 6 million active customers and partners with over 85,000 merchants. In Australia, Zip positions itself as a credit card alternative, with several revolving credit products. Customers can carry the balance over time with a monthly fee and set their own repayment schedule. The US and New Zealand offering is a far more vanilla BNPL offering: Pay-in-4 in New Zealand and Pay-in-Z in the US, where customers pay back in fixed instalments. The US segment is built on the 2020 acquisition of QuadPay and has recently become Zip's largest and fastest-growing segment.
72GF 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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