Tokai Electronics CoNGO:8071 -1.16%69 Operating Margin % is 2.99% as of Sep. 2025, which is 24% above its 10-year median of 2.41. GuruFocus rates NGO:8071 with a GF Score™ of 69/100 and a GF Value™ of 円2,263.65 (Modestly Overvalued). The stock has 5 warning signs investors should review. Among 2,472 Hardware companies, Tokai Electronics Co ranks worse than 60.11% on this metric.
Tokai Electronics Co (NGO:8071) 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.
Tokai Electronics Co Operating Margin % Related Terms
Tokai Electronics Co Operating Margin % Historical Data
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The historical data trend for Tokai Electronics Co'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.
NGO:8071 vs APH, GLW, TEL: Operating Margin % Comparison
For the Electronic Components subindustry, Tokai Electronics Co'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.
Tokai Electronics Co Operating Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Tokai Electronics Co's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Tokai Electronics Co's Operating Margin % falls into.
Tokai Electronics Co 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.
Tokai Electronics Co's Operating Margin % for the fiscal year that ended in Mar. 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.
Tokai Electronics Co (NGO:8071) has a Operating Margin % of 2.99% as of Sep. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Tokai Electronics Co and its competitors. This is 24% above median its historical median of 2.41. Over the past decade, Tokai Electronics Co's Operating Margin % has ranged from 1.02 to 4.35. According to the industry distribution chart, Tokai Electronics Co ranks #1486 out of 2472 companies in the Hardware industry, placing it in the top 60.1%.
Is Tokai Electronics Co's Operating Margin % too high?
Tokai Electronics Co's current Operating Margin % of 2.99% is 24% above median its 10-year median of 2.41. Over the past 10 years, this metric has ranged from a low of 1.02 to a high of 4.35. The Hardware industry median Operating Margin % is 3.81. Tokai Electronics Co's value of 2.99% is 21.5% below this industry median. Based on the distribution chart, Tokai Electronics Co ranks #1486 out of 2472 companies in the Hardware industry, which is below the industry midpoint. Overall, Tokai Electronics Co has a GF Score™ of 69/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Tokai Electronics Co's Operating Margin % compare to APH and GLW?
According to the Hardware industry distribution chart, Tokai Electronics Co ranks #1486 out of 2472 companies for Operating Margin %. This places Tokai Electronics Co in the lower half of its industry. The industry median Operating Margin % is 3.81. Tokai Electronics Co's value of 2.99% is 21.5% below this benchmark. Historically, Tokai Electronics Co's own Operating Margin % has ranged from 1.02 to 4.35 over the past decade. While the company's 10-year median is 2.41 vs. the industry median of 3.81, Tokai Electronics Co 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 Hardware company?
The median Operating Margin % among Hardware companies is 3.81, based on 2,472 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. Tokai Electronics Co's current Operating Margin % of 2.99% is 21.5% 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 Tokai Electronics Co and its competitors. For the Hardware industry, the median Operating Margin % is 3.81 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Tokai Electronics Co's current Operating Margin % is 2.99%, which is 24% above median its own 10-year median of 2.41. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Tokai Electronics Co stock overvalued right now?
Based on GuruFocus' analysis, Tokai Electronics Co (NGO:8071) is currently considered Modestly Overvalued. The stock's GF Value™ is 円2,263.65, compared to a current price of 円2,807.00 — trading 24% above its estimated fair value. The current Operating Margin % is 2.99%, which is 24% above median its 10-year median of 2.41 and 21.5% below the Hardware industry median of 3.81. Tokai Electronics Co's overall GF Score™ is 69/100 with 5 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 Tokai Electronics Co (NGO:8071), the current Operating Margin % is 2.99% 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 Tokai Electronics Co (NGO:8071) Overvalued in 2026?
Based on GuruFocus' analysis, Tokai Electronics Co stock appears to be overvalued.
The current stock price of 円2,807.00 is trading 24% above its estimated GF Value™ of 円2,263.65.
GuruFocus considers Tokai Electronics Co to be Modestly Overvalued.
Key valuation signals for NGO:8071:
Operating Margin %: 2.99% (24% above median its 10-year median of 2.41)
GF Value™: 円2,263.65 vs. price of 円2,807.00 (24% above fair value)
Industry Position: 21.5% below the Hardware median (#1486 of 2472)
No single metric tells the full story. See the NGO:8071 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Tokai Electronics Co Ltd is engaged in the development, sales, import, and export of electronic devices, semiconductor devices, computer and microcomputer applied systems, and software.
69GF Score
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