Steel DynamicsSTU:SD5 +3.72%86 Operating Margin % is 11.15% as of Mar. 2026, which is 8% below its 10-year median of 12.08. GuruFocus rates STU:SD5 with a GF Score™ of 86/100 and a GF Value™ of €137.36 (Significantly Overvalued). The stock has 4 warning signs investors should review. Among 615 Steel companies, Steel Dynamics ranks better than 82.44% on this metric.
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.
Steel Dynamics Operating Margin % Related Terms
Steel Dynamics Operating Margin % Historical Data
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The historical data trend for Steel Dynamics'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.
STU:SD5 vs RS, NUE, TX: Operating Margin % Comparison
For the Steel subindustry, Steel Dynamics'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.
Steel Dynamics Operating Margin % vs Steel Industry
For the Steel industry and Basic Materials sector, Steel Dynamics's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Steel Dynamics'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.
Steel Dynamics'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.
Steel Dynamics (STU:SD5) has a Operating Margin % of 11.15% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Steel Dynamics and its competitors. This is near median its historical median of 12.08. Over the past decade, Steel Dynamics' Operating Margin % has ranged from 8.80 to 25.47. According to the industry distribution chart, Steel Dynamics ranks #108 out of 615 companies in the Steel industry, placing it in the top 17.6%.
Is Steel Dynamics' Operating Margin % too high?
Steel Dynamics' current Operating Margin % of 11.15% is near median its 10-year median of 12.08. Over the past 10 years, this metric has ranged from a low of 8.80 to a high of 25.47. The Steel industry median Operating Margin % is 2.99. Steel Dynamics' value of 11.15% is 272.9% above this industry median. Based on the distribution chart, Steel Dynamics ranks #108 out of 615 companies in the Steel industry, which is in the top quartile — a strong position relative to peers. Overall, Steel Dynamics has a GF Score™ of 86/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Steel Dynamics' Operating Margin % compare to RS and NUE?
According to the Steel industry distribution chart, Steel Dynamics ranks #108 out of 615 companies for Operating Margin %. This places Steel Dynamics in the top 18% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 2.99. Steel Dynamics' value of 11.15% is 272.9% above this benchmark. Historically, Steel Dynamics' own Operating Margin % has ranged from 8.80 to 25.47 over the past decade. While the company's 10-year median is 12.08 vs. the industry median of 2.99, Steel Dynamics 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 Steel company?
The median Operating Margin % among Steel companies is 2.99, based on 615 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. Steel Dynamics's current Operating Margin % of 11.15% is 272.9% 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 Steel Dynamics and its competitors. For the Steel industry, the median Operating Margin % is 2.99 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Steel Dynamics's current Operating Margin % is 11.15%, which is near median its own 10-year median of 12.08. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Steel Dynamics stock overvalued right now?
Based on GuruFocus' analysis, Steel Dynamics (STU:SD5) is currently considered Significantly Overvalued. The stock's GF Value™ is €137.36, compared to a current price of €220.30 — trading 60.4% above its estimated fair value. The current Operating Margin % is 11.15%, which is near median its 10-year median of 12.08 and 272.9% above the Steel industry median of 2.99. Steel Dynamics' overall GF Score™ is 86/100 with 4 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 Steel Dynamics (STU:SD5), the current Operating Margin % is 11.15% 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 Steel Dynamics (STU:SD5) Overvalued in 2026?
Based on GuruFocus' analysis, Steel Dynamics stock appears to be overvalued.
The current stock price of €220.30 is trading 60.4% above its estimated GF Value™ of €137.36.
GuruFocus considers Steel Dynamics to be Significantly Overvalued.
Key valuation signals for STU:SD5:
Operating Margin %: 11.15% (near median its 10-year median of 12.08)
GF Value™: €137.36 vs. price of €220.30 (60.4% above fair value)
Industry Position: 272.9% above the Steel median (#108 of 615)
No single metric tells the full story. See the STU:SD5 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Steel Dynamics Inc operates as a domestic steel producer and metal recycler in the United States. The company's product portfolio comprises hot rolled sheet, hot rolled plate, painted sheet products, cold rolled sheet, and others. Its reportable segments are steel operations, metals recycling operations, steel fabrication operations, and aluminum operations. Maximum revenue is generated from its steel operations segment, which consists of manufacturing various steel products and numerous coating operations. Its primary sources of revenue are currently from the manufacture and sale of steel products, the processing and sale of recycled ferrous and nonferrous metals, and the fabrication and sale of steel joists and deck products.
86GF Score
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