Essential UtilitiesMEX:WTRG 73 Operating Margin % is 36.05% as of Mar. 2026, which is 2% below its 10-year median of 36.77. GuruFocus rates MEX:WTRG with a GF Score™ of 73/100. The stock has 7 warning signs investors should review. Among 499 Utilities - Regulated companies, Essential Utilities ranks better than 90.38% on this metric.
Essential Utilities Inc operating margin is expanding. Margin expansion is usually a good sign.
The historical rank and industry rank for Essential Utilities's Operating Margin % or its related term are showing as below:
MEX:WTRG'
s Operating Margin % Range Over the Past 10 Years
Min: 28.9 Med: 36.77 Max: 41.25
Current: 34.97
MEX:WTRG's Operating Margin % is ranked better than 90.38% of 499
companies
in the Utilities - Regulated industry
Industry Median: 14.97
vs MEX:WTRG: 34.97
Essential Utilities's 5-Year Average Operating Margin % Growth Rate was 4.80% per year.
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.
Essential Utilities Operating Margin % Related Terms
Essential Utilities Operating Margin % Historical Data
* Premium members only.
The historical data trend for Essential Utilities'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:WTRG vs AWR, CWT, HTO: Operating Margin % Comparison
For the Utilities - Regulated Water subindustry, Essential Utilities'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.
Essential Utilities Operating Margin % vs Utilities - Regulated Industry
For the Utilities - Regulated industry and Utilities sector, Essential Utilities's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Essential Utilities'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.
Essential Utilities's Operating Margin % for the fiscal year that ended in Dec. 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.
Essential Utilities (MEX:WTRG) has a Operating Margin % of 36.05% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Essential Utilities and its competitors. This is near median its historical median of 36.77. Over the past decade, Essential Utilities' Operating Margin % has ranged from 28.90 to 41.25. According to the industry distribution chart, Essential Utilities ranks #48 out of 499 companies in the Utilities - Regulated industry, placing it in the top 9.6%.
Is Essential Utilities' Operating Margin % too high?
Essential Utilities' current Operating Margin % of 36.05% is near median its 10-year median of 36.77. Over the past 10 years, this metric has ranged from a low of 28.90 to a high of 41.25. The Utilities - Regulated industry median Operating Margin % is 14.97. Essential Utilities' value of 36.05% is 140.8% above this industry median. Based on the distribution chart, Essential Utilities ranks #48 out of 499 companies in the Utilities - Regulated industry, which is in the top quartile — a strong position relative to peers. Overall, Essential Utilities has a GF Score™ of 73/100, reflecting its overall financial health beyond just this single metric.
How does Essential Utilities' Operating Margin % compare to AWR and CWT?
According to the Utilities - Regulated industry distribution chart, Essential Utilities ranks #48 out of 499 companies for Operating Margin %. This places Essential Utilities in the top 10% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 14.97. Essential Utilities' value of 36.05% is 140.8% above this benchmark. Historically, Essential Utilities' own Operating Margin % has ranged from 28.90 to 41.25 over the past decade. While the company's 10-year median is 36.77 vs. the industry median of 14.97, Essential Utilities 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 an Utilities - Regulated company?
The median Operating Margin % among Utilities - Regulated companies is 14.97, based on 499 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. Essential Utilities's current Operating Margin % of 36.05% is 140.8% 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 Essential Utilities and its competitors. For the Utilities - Regulated industry, the median Operating Margin % is 14.97 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Essential Utilities's current Operating Margin % is 36.05%, which is near median its own 10-year median of 36.77. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Essential Utilities stock overvalued right now?
Essential Utilities (MEX:WTRG) has a current Operating Margin % of 36.05%. The current Operating Margin % is 36.05%, which is near median its 10-year median of 36.77 and 140.8% above the Utilities - Regulated industry median of 14.97. Essential Utilities' overall GF Score™ is 73/100 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 Essential Utilities (MEX:WTRG), the current Operating Margin % is 36.05% 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.
Essential Utilities is a Pennsylvania-based holding company for US water, wastewater, and natural gas distribution utilities. The company's water business serves 3 million people in eight states. Its largest service territory is in Pennsylvania, primarily suburban Philadelphia. Its Peoples subsidiary serves more than 740,000 gas distribution customers in Pennsylvania and Kentucky. It completed the sale of its West Virginia gas utility and the bulk of its nonregulated assets in 2024. Essential shareholders would own a 31% stake in American Water Works if the proposed all-stock merger closes in 2027.
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