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Chunghwa Precision Test Tech Co (ROCO:6510) 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.
Chunghwa Precision Test Tech Co Operating Margin % Related Terms
Chunghwa Precision Test Tech Co 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.
Chunghwa Precision Test Tech Co Operating Margin % Chart
ROCO:6510 vs AMAT, LRCX, KLAC: Operating Margin % Comparison
For the Semiconductor Equipment & Materials subindustry, Chunghwa Precision Test Tech 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.
Chunghwa Precision Test Tech Co Operating Margin % vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Chunghwa Precision Test Tech Co's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Chunghwa Precision Test Tech Co's Operating Margin % falls into.
Chunghwa Precision Test Tech 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.
* 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.
Chunghwa Precision Test Tech Co (ROCO:6510) has a Operating Margin % of 26.71% as of Dec. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Chunghwa Precision Test Tech Co and its competitors. This is near median its historical median of 25.59. According to the industry distribution chart, Chunghwa Precision Test Tech Co ranks #117 out of 1023 companies in the Semiconductors industry, placing it in the top 11.4%.
Is Chunghwa Precision Test Tech Co's Operating Margin % too high?
Chunghwa Precision Test Tech Co's current Operating Margin % of 26.71% is near median its 10-year median of 25.59. The Semiconductors industry median Operating Margin % is 5.33. Chunghwa Precision Test Tech Co's value of 26.71% is 401.1% above this industry median. Based on the distribution chart, Chunghwa Precision Test Tech Co ranks #117 out of 1023 companies in the Semiconductors industry, which is in the top quartile — a strong position relative to peers. Overall, Chunghwa Precision Test Tech Co has a GF Score™ of 73/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Chunghwa Precision Test Tech Co's Operating Margin % compare to AMAT and LRCX?
According to the Semiconductors industry distribution chart, Chunghwa Precision Test Tech Co ranks #117 out of 1023 companies for Operating Margin %. This places Chunghwa Precision Test Tech Co in the top 11% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 5.33. Chunghwa Precision Test Tech Co's value of 26.71% is 401.1% above this benchmark. While the company's 10-year median is 25.59 vs. the industry median of 5.33, Chunghwa Precision Test Tech Co 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 Semiconductors company?
The median Operating Margin % among Semiconductors companies is 5.33, based on 1,023 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. Chunghwa Precision Test Tech Co's current Operating Margin % of 26.71% is 401.1% 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 Chunghwa Precision Test Tech Co and its competitors. For the Semiconductors industry, the median Operating Margin % is 5.33 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Chunghwa Precision Test Tech Co's current Operating Margin % is 26.71%, which is near median its own 10-year median of 25.59. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Chunghwa Precision Test Tech Co stock overvalued right now?
Based on GuruFocus' analysis, Chunghwa Precision Test Tech Co (ROCO:6510) is currently considered Significantly Overvalued. The stock's GF Value™ is NT$1,108.88, compared to a current price of NT$2,760.00 — trading 148.9% above its estimated fair value. The current Operating Margin % is 26.71%, which is near median its 10-year median of 25.59 and 401.1% above the Semiconductors industry median of 5.33. Chunghwa Precision Test Tech Co's overall GF Score™ is 73/100. 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 Chunghwa Precision Test Tech Co (ROCO:6510), the current Operating Margin % is 26.71% as of Dec. 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 Chunghwa Precision Test Tech Co (ROCO:6510) Overvalued in 2026?
Based on GuruFocus' analysis, Chunghwa Precision Test Tech Co stock appears to be overvalued.
The current stock price of NT$2,760.00 is trading 148.9% above its estimated GF Value™ of NT$1,108.88.
GuruFocus considers Chunghwa Precision Test Tech Co to be Significantly Overvalued.
Key valuation signals for ROCO:6510:
Operating Margin %: 26.71% (near median its 10-year median of 25.59)
GF Value™: NT$1,108.88 vs. price of NT$2,760.00 (148.9% above fair value)
Industry Position: 401.1% above the Semiconductors median (#117 of 1023)
No single metric tells the full story. See the ROCO:6510 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Chunghwa Precision Test Tech Co Business Description
Chunghwa Precision Test Tech Co Ltd is engaged mainly in the testing of semiconductor components, the production of printed circuit boards, and the marketing of electronic products. The company earns operating revenue from the production and sales of semiconductor testing components and printed circuit boards, as well as other electronic products. It also earns revenue from the rendering of services such as designing and maintaining semiconductor components, printed circuit boards, and providing after-sales services. It generates maximum revenue from the sale of wafer test boards. Geographically, the company generates maximum revenue from Taiwan, followed by the United States, China, and Other regions.
73GF Score
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