Cegid GroupLTS:0RIY Operating Margin % is 17.27% as of Dec. 2016, which is 40% above its 10-year median of 12.31. The stock has 4 warning signs investors should review.
Operating Margin % is calculated as Operating Income divided by its Revenue. Cegid Group's Operating Income for the
six
months ended in Dec. 2016 was €27.12 Mil. Cegid Group's Revenue for the
six
months ended in Dec. 2016 was €157.10 Mil. Therefore, Cegid Group's Operating Margin % for the quarter that ended in Dec. 2016 was 17.27%.
Good Sign:
Cegid Group SA operating margin is expanding. Margin expansion is usually a good sign.
The historical rank and industry rank for Cegid Group's Operating Margin % or its related term are showing as below:
LTS:0RIY'
s Operating Margin % Range Over the Past 10 Years
Min: 8.82 Med: 12.31 Max: 13.97
Current: 13.97
LTS:0RIY's Operating Margin % is not ranked
in the Software industry.
Industry Median: 3.865
vs LTS:0RIY: 13.97
Cegid Group's 5-Year Average Operating Margin % Growth Rate was 8.00% per year.
Cegid Group's Operating Income for the
six
months ended in Dec. 2016 was €27.12 Mil.
Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2016 was €42.97 Mil.
Cegid Group (LTS:0RIY) 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.
Cegid Group Operating Margin % Related Terms
Cegid Group Operating Margin % Historical Data
* Premium members only.
The historical data trend for Cegid Group'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.
LTS:0RIY vs TYPE, MTLS, TIVO: Operating Margin % Comparison
For the Software - Application subindustry, Cegid Group'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.
Cegid Group Operating Margin % vs Software Industry
For the Software industry and Technology sector, Cegid Group's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Cegid Group'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.
Cegid Group's Operating Margin % for the fiscal year that ended in Dec. 2016 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.
Cegid Group (LTS:0RIY) has a Operating Margin % of 17.27% as of Dec. 2016. Operating margin is the ratio of total operating income to net sales. View historical data on Cegid Group and its competitors. This is 40% above median its historical median of 12.31. Over the past decade, Cegid Group's Operating Margin % has ranged from 8.82 to 13.97.
Is Cegid Group's Operating Margin % too high?
Cegid Group's current Operating Margin % of 17.27% is 40% above median its 10-year median of 12.31. Over the past 10 years, this metric has ranged from a low of 8.82 to a high of 13.97. The Software industry median Operating Margin % is 3.87. Cegid Group's value of 17.27% is 346.8% above this industry median.
How does Cegid Group's Operating Margin % compare to TYPE and MTLS?
Cegid Group's Operating Margin % of 17.27% can be compared against companies in the Software industry. The industry median Operating Margin % is 3.87. Cegid Group's value of 17.27% is 346.8% above this benchmark. Historically, Cegid Group's own Operating Margin % has ranged from 8.82 to 13.97 over the past decade. While the company's 10-year median is 12.31 vs. the industry median of 3.87, Cegid Group has consistently been above 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 Software company?
The median Operating Margin % among Software companies is 3.87, based on 2,818 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. Cegid Group's current Operating Margin % of 17.27% is 346.8% 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 Cegid Group and its competitors. For the Software industry, the median Operating Margin % is 3.87 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Cegid Group's current Operating Margin % is 17.27%, which is 40% above median its own 10-year median of 12.31. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Cegid Group stock overvalued right now?
Cegid Group (LTS:0RIY) has a current Operating Margin % of 17.27%. The current Operating Margin % is 17.27%, which is 40% above median its 10-year median of 12.31 and 346.8% above the Software industry median of 3.87. 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 Cegid Group (LTS:0RIY), the current Operating Margin % is 17.27% as of Dec. 2016. 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.
Cegid Group SA is engaged in the development, hosting, sell and distribution of business management software and related goods and services. It serves the finance, taxation, human resources, public, retail, manufacturing, services, trade, and accounting profession sectors, as well as startups and small businesses. Geographically business activity of the group is based in France.
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