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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.
Kwong Fong Industries Operating Margin % Related Terms
Kwong Fong Industries Operating Margin % Historical Data
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The historical data trend for Kwong Fong Industries'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.
TPE:1416 vs IBM, ACN, FISV: Operating Margin % Comparison
For the Information Technology Services subindustry, Kwong Fong Industries'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.
Kwong Fong Industries Operating Margin % vs Software Industry
For the Software industry and Technology sector, Kwong Fong Industries's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Kwong Fong Industries'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.
Kwong Fong Industries'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.
Kwong Fong Industries (TPE:1416) has a Operating Margin % of 8.80% as of Dec. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Kwong Fong Industries and its competitors. According to the industry distribution chart, Kwong Fong Industries ranks #1756 out of 2827 companies in the Software industry, placing it in the top 62.1%.
Is Kwong Fong Industries' Operating Margin % too high?
Kwong Fong Industries' current Operating Margin % is 8.80%. The Software industry median Operating Margin % is 3.92. Kwong Fong Industries' value of 8.80% is 124.5% above this industry median. Based on the distribution chart, Kwong Fong Industries ranks #1756 out of 2827 companies in the Software industry, which is below the industry midpoint. Overall, Kwong Fong Industries has a GF Score™ of 65/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Kwong Fong Industries' Operating Margin % compare to IBM and ACN?
According to the Software industry distribution chart, Kwong Fong Industries ranks #1756 out of 2827 companies for Operating Margin %. This places Kwong Fong Industries in the lower half of its industry. The industry median Operating Margin % is 3.92. Kwong Fong Industries' value of 8.80% is 124.5% above this benchmark. 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 Software company?
The median Operating Margin % among Software companies is 3.92, based on 2,827 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. Kwong Fong Industries's current Operating Margin % of 8.80% is 124.5% 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 Kwong Fong Industries and its competitors. For the Software industry, the median Operating Margin % is 3.92 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Kwong Fong Industries's current Operating Margin % is 8.80%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Kwong Fong Industries stock overvalued right now?
Based on GuruFocus' analysis, Kwong Fong Industries (TPE:1416) is currently considered Modestly Undervalued. The stock's GF Value™ is NT$15.49, compared to a current price of NT$10.80 — trading 30.3% below its estimated fair value. The current Operating Margin % is 8.80% and 124.5% above the Software industry median of 3.92. Kwong Fong Industries' overall GF Score™ is 65/100 with 6 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 Kwong Fong Industries (TPE:1416), the current Operating Margin % is 8.80% 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 Kwong Fong Industries (TPE:1416) Overvalued in 2026?
Based on GuruFocus' analysis, Kwong Fong Industries stock appears to be undervalued.
The current stock price of NT$10.80 is trading 30.3% below its estimated GF Value™ of NT$15.49.
GuruFocus considers Kwong Fong Industries to be Modestly Undervalued.
Key valuation signals for TPE:1416:
Operating Margin %: 8.80%
GF Value™: NT$15.49 vs. price of NT$10.80 (30.3% below fair value)
Industry Position: 124.5% above the Software median (#1756 of 2827)
No single metric tells the full story. See the TPE:1416 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Kwong Fong Industries Corp main business items include housing and building development and rental, real estate business, mall management, information software services, and electronic information supply services. The company's segment includes the Kwong Fong Department, the Pao Fong Asset Management Department, the Kwong Fong Holdings Department, and the Digital Technology Department. The company generates the majority of its revenue from the Digital Technology Department, which is engaged in Information Software Services. The company generates all of its revenue from Taiwan. The company's revenue is derived from information services, software sales, and real estate sales.
65GF Score
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Operating Margin % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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