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.
Treehouse Foods Operating Margin % Related Terms
Treehouse Foods Operating Margin % Historical Data
* Premium members only.
The historical data trend for Treehouse Foods'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.
MEX:THS vs JBSS, OFRM, SMPL: Operating Margin % Comparison
For the Packaged Foods subindustry, Treehouse Foods'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.
Treehouse Foods Operating Margin % vs Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, Treehouse Foods's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Treehouse Foods'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.
Treehouse Foods's Operating Margin % for the fiscal year that ended in Dec. 2024 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.
Treehouse Foods (MEX:THS) has a Operating Margin % of 7.47% as of Sep. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Treehouse Foods and its competitors. This is 62% above median its historical median of 4.60. Over the past decade, Treehouse Foods' Operating Margin % has ranged from 1.39 to 7.53.
Is Treehouse Foods' Operating Margin % too high?
Treehouse Foods' current Operating Margin % of 7.47% is 62% above median its 10-year median of 4.60. Over the past 10 years, this metric has ranged from a low of 1.39 to a high of 7.53. The Consumer Packaged Goods industry median Operating Margin % is 5.30. Treehouse Foods' value of 7.47% is 40.9% above this industry median. Overall, Treehouse Foods has a GF Score™ of 63/100, reflecting its overall financial health beyond just this single metric.
How does Treehouse Foods' Operating Margin % compare to JBSS and OFRM?
Treehouse Foods' Operating Margin % of 7.47% can be compared against companies in the Consumer Packaged Goods industry. The industry median Operating Margin % is 5.30. Treehouse Foods' value of 7.47% is 40.9% above this benchmark. Historically, Treehouse Foods' own Operating Margin % has ranged from 1.39 to 7.53 over the past decade. While the company's 10-year median is 4.60 vs. the industry median of 5.30, Treehouse Foods 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 Consumer Packaged Goods company?
The median Operating Margin % among Consumer Packaged Goods companies is 5.30, based on 1,945 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. Treehouse Foods's current Operating Margin % of 7.47% is 40.9% 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 Treehouse Foods and its competitors. For the Consumer Packaged Goods industry, the median Operating Margin % is 5.30 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Treehouse Foods's current Operating Margin % is 7.47%, which is 62% above median its own 10-year median of 4.60. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Treehouse Foods stock overvalued right now?
Treehouse Foods (MEX:THS) has a current Operating Margin % of 7.47%. The stock's GF Value™ is MXN1,214.01, compared to a current price of MXN703.30 — trading 42.1% below its estimated fair value. The current Operating Margin % is 7.47%, which is 62% above median its 10-year median of 4.60 and 40.9% above the Consumer Packaged Goods industry median of 5.30. Treehouse Foods' overall GF Score™ is 63/100 with 6 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 Treehouse Foods (MEX:THS), the current Operating Margin % is 7.47% as of Sep. 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 Treehouse Foods (MEX:THS) Overvalued in 2026?
Based on GuruFocus' analysis, Treehouse Foods stock appears to be undervalued.
The current stock price of MXN703.30 is trading 42.1% below its estimated GF Value™ of MXN1,214.01.
Key valuation signals for MEX:THS:
Operating Margin %: 7.47% (62% above median its 10-year median of 4.60)
GF Value™: MXN1,214.01 vs. price of MXN703.30 (42.1% below fair value)
Industry Position: 40.9% above the Consumer Packaged Goods median
No single metric tells the full story. See the MEX:THS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
TreeHouse Foods is the largest pure-play private-label manufacturer in the US. Much larger in the past following the 2016 acquisition of Ralcorp, Conagra's former private-label business, the company has since divested several businesses to focus on high-growth categories. At present, the company produces and sells snacks (crackers, pretzels, cookies, and so on), beverages (such as nondairy creamer, coffee, tea, and broth), and a select number of grocery products (pickles, refrigerated dough, hot cereal, cheese, and pudding). Its most important sales channel is through retail grocery stores that sell its products under their own brands, with co-manufacturing and food away from home as much smaller channels of distribution for its fare.
63GF Score
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