Advanced Drainage SystemsMEX:WMS 59 Operating Margin % is 12.02% as of Mar. 2026, which is 26% below its 10-year median of 16.30. GuruFocus rates MEX:WMS with a GF Score™ of 59/100 and a GF Value™ of MXN1,996.53 (Fairly Valued). The stock has 3 warning signs investors should review. Among 1,767 Construction companies, Advanced Drainage Systems ranks better than 91.68% on this metric.
Advanced Drainage Systems (MEX:WMS) 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.
Advanced Drainage Systems Operating Margin % Related Terms
Advanced Drainage Systems Operating Margin % Historical Data
* 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.
Advanced Drainage Systems Operating Margin % Chart
MEX:WMS vs SPXC, OC, AAON: Operating Margin % Comparison
For the Building Products & Equipment subindustry, Advanced Drainage Systems'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.
Advanced Drainage Systems Operating Margin % vs Construction Industry
For the Construction industry and Industrials sector, Advanced Drainage Systems's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Advanced Drainage Systems's Operating Margin % falls into.
Advanced Drainage Systems Operating Margin % Calculation
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.
Advanced Drainage Systems'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.
Advanced Drainage Systems (MEX:WMS) has a Operating Margin % of 12.02% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Advanced Drainage Systems and its competitors. This is 26% below median its historical median of 16.30. According to the industry distribution chart, Advanced Drainage Systems ranks #147 out of 1767 companies in the Construction industry, placing it in the top 8.3%.
Is Advanced Drainage Systems' Operating Margin % too high?
Advanced Drainage Systems' current Operating Margin % of 12.02% is 26% below median its 10-year median of 16.30. The Construction industry median Operating Margin % is 5.89. Advanced Drainage Systems' value of 12.02% is 104.1% above this industry median. Based on the distribution chart, Advanced Drainage Systems ranks #147 out of 1767 companies in the Construction industry, which is in the top quartile — a strong position relative to peers. Overall, Advanced Drainage Systems has a GF Score™ of 59/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Advanced Drainage Systems' Operating Margin % compare to SPXC and OC?
According to the Construction industry distribution chart, Advanced Drainage Systems ranks #147 out of 1767 companies for Operating Margin %. This places Advanced Drainage Systems in the top 8% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 5.89. Advanced Drainage Systems' value of 12.02% is 104.1% above this benchmark. While the company's 10-year median is 16.30 vs. the industry median of 5.89, Advanced Drainage Systems 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 Construction company?
The median Operating Margin % among Construction companies is 5.89, based on 1,767 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. Advanced Drainage Systems's current Operating Margin % of 12.02% is 104.1% 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 Advanced Drainage Systems and its competitors. For the Construction industry, the median Operating Margin % is 5.89 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Advanced Drainage Systems's current Operating Margin % is 12.02%, which is 26% below median its own 10-year median of 16.30. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Advanced Drainage Systems stock overvalued right now?
Based on GuruFocus' analysis, Advanced Drainage Systems (MEX:WMS) is currently considered Fairly Valued. The stock's GF Value™ is MXN1,996.53, compared to a current price of MXN2,100.00 — trading 5.2% above its estimated fair value. The current Operating Margin % is 12.02%, which is 26% below median its 10-year median of 16.30 and 104.1% above the Construction industry median of 5.89. Advanced Drainage Systems' overall GF Score™ is 59/100 with 3 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 Advanced Drainage Systems (MEX:WMS), the current Operating Margin % is 12.02% 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 Advanced Drainage Systems (MEX:WMS) Overvalued in 2026?
Based on GuruFocus' analysis, Advanced Drainage Systems stock appears to be overvalued.
The current stock price of MXN2,100.00 is trading 5.2% above its estimated GF Value™ of MXN1,996.53.
GuruFocus considers Advanced Drainage Systems to be Fairly Valued.
Key valuation signals for MEX:WMS:
Operating Margin %: 12.02% (26% below median its 10-year median of 16.30)
GF Value™: MXN1,996.53 vs. price of MXN2,100.00 (5.2% above fair value)
Industry Position: 104.1% above the Construction median (#147 of 1767)
No single metric tells the full story. See the MEX:WMS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Advanced Drainage Systems Inc designs, manufactures and markets water management solutions in the stormwater and onsite wastewater industries, providing superior drainage solutions for use in the construction and agriculture markets. The company's products are used across a broad range of end markets and applications, including non-residential, residential, infrastructure and agriculture applications. It has two reportable segments: Stormwater and Wastewater. It derives the majority of revenue from the Stormwater segment, which manufactures and markets thermoplastic corrugated pipe and complementary products, including single wall pipe, N-12 HDPE pipe, polypropylene pipe, StormTech, Nyloplast, Inserta Tee, water quality filters and structures, and NDS channel drains, and access boxes.
59GF Score
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