Cerved Group SpA (MEX:CERVN) 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.
Cerved Group SpA Operating Margin % Related Terms
Cerved Group SpA Operating Margin % Historical Data
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The historical data trend for Cerved Group SpA'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.
For the Financial Data & Stock Exchanges subindustry, Cerved Group SpA'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.
Cerved Group SpA Operating Margin % vs Capital Markets Industry
For the Capital Markets industry and Financial Services sector, Cerved Group SpA's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Cerved Group SpA'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.
Cerved Group SpA's Operating Margin % for the fiscal year that ended in Dec. 2020 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.
Cerved Group SpA (MEX:CERVN) has a Operating Margin % of 2.84% as of Sep. 2021. Operating margin is the ratio of total operating income to net sales. View historical data on Cerved Group SpA and its competitors. This is 89% below median its historical median of 27.00. Over the past decade, Cerved Group SpA's Operating Margin % has ranged from 23.82 to 29.46.
Is Cerved Group SpA's Operating Margin % too high?
Cerved Group SpA's current Operating Margin % of 2.84% is 89% below median its 10-year median of 27.00. Over the past 10 years, this metric has ranged from a low of 23.82 to a high of 29.46. The Capital Markets industry median Operating Margin % is 7.13. Cerved Group SpA's value of 2.84% is 60.2% below this industry median. Overall, Cerved Group SpA has a GF Score™ of 8/100, reflecting its overall financial health beyond just this single metric.
How does Cerved Group SpA's Operating Margin % compare to VALU?
Cerved Group SpA's Operating Margin % of 2.84% can be compared against companies in the Capital Markets industry. The industry median Operating Margin % is 7.13. Cerved Group SpA's value of 2.84% is 60.2% below this benchmark. Historically, Cerved Group SpA's own Operating Margin % has ranged from 23.82 to 29.46 over the past decade. While the company's 10-year median is 27.00 vs. the industry median of 7.13, Cerved Group SpA 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 Capital Markets company?
The median Operating Margin % among Capital Markets companies is 7.13, based on 667 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. Cerved Group SpA's current Operating Margin % of 2.84% is 60.2% 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 Cerved Group SpA and its competitors. For the Capital Markets industry, the median Operating Margin % is 7.13 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Cerved Group SpA's current Operating Margin % is 2.84%, which is 89% below median its own 10-year median of 27.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Cerved Group SpA stock overvalued right now?
Cerved Group SpA (MEX:CERVN) has a current Operating Margin % of 2.84%. The current Operating Margin % is 2.84%, which is 89% below median its 10-year median of 27.00 and 60.2% below the Capital Markets industry median of 7.13. Cerved Group SpA's overall GF Score™ is 8/100 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 Cerved Group SpA (MEX:CERVN), the current Operating Margin % is 2.84% as of Sep. 2021. 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.
Cerved Group SpA is a holding company that owns the Cerved Group, an Italian credit information service provider. It operates through three segments. The Risk Management segment, which accounts for the majority of the Cerved Group's revenue, offers products and services that help businesses and financial institutions to assess the credit status of their customers, business counterparties, and potential customers. The Growth Services segment offers information and analyses that help customers to understand the target market and regions, develop businesses, and improve customer satisfaction. The credit management segment assesses and manages troubled receivables and assets. It generates the majority of its revenue from the Italian domestic market.
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