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Nippon Denko CoTSE:5563 -1.17%72 Operating Margin % is 10.32% as of Dec. 2025, which is 34% above its 10-year median of 7.73. GuruFocus rates TSE:5563 with a GF Score™ of 72/100 and a GF Value™ of 円308.34 (Significantly Overvalued). The stock has 4 warning signs investors should review. Among 611 Steel companies, Nippon Denko Co ranks better than 74.8% on this metric.
Nippon Denko Co (TSE:5563) 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.
Nippon Denko Co Operating Margin % Related Terms
Nippon Denko Co Operating Margin % Historical Data
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The historical data trend for Nippon Denko 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.
TSE:5563 vs NUE, STLD, RS: Operating Margin % Comparison
For the Steel subindustry, Nippon Denko 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.
Nippon Denko Co Operating Margin % vs Steel Industry
For the Steel industry and Basic Materials sector, Nippon Denko Co's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Nippon Denko Co'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.
Nippon Denko Co'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.
Nippon Denko Co (TSE:5563) has a Operating Margin % of 10.32% as of Dec. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Nippon Denko Co and its competitors. This is 34% above median its historical median of 7.73. According to the industry distribution chart, Nippon Denko Co ranks #154 out of 611 companies in the Steel industry, placing it in the top 25.2%.
Is Nippon Denko Co's Operating Margin % too high?
Nippon Denko Co's current Operating Margin % of 10.32% is 34% above median its 10-year median of 7.73. The Steel industry median Operating Margin % is 3.01. Nippon Denko Co's value of 10.32% is 242.9% above this industry median. Based on the distribution chart, Nippon Denko Co ranks #154 out of 611 companies in the Steel industry, which is above the industry midpoint. Overall, Nippon Denko Co has a GF Score™ of 72/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Nippon Denko Co's Operating Margin % compare to NUE and STLD?
According to the Steel industry distribution chart, Nippon Denko Co ranks #154 out of 611 companies for Operating Margin %. This puts Nippon Denko Co in the upper half of its industry. The industry median Operating Margin % is 3.01. Nippon Denko Co's value of 10.32% is 242.9% above this benchmark. While the company's 10-year median is 7.73 vs. the industry median of 3.01, Nippon Denko 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 Steel company?
The median Operating Margin % among Steel companies is 3.01, based on 611 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. Nippon Denko Co's current Operating Margin % of 10.32% is 242.9% 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 Nippon Denko Co and its competitors. For the Steel industry, the median Operating Margin % is 3.01 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Nippon Denko Co's current Operating Margin % is 10.32%, which is 34% above median its own 10-year median of 7.73. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Nippon Denko Co stock overvalued right now?
Based on GuruFocus' analysis, Nippon Denko Co (TSE:5563) is currently considered Significantly Overvalued. The stock's GF Value™ is 円308.34, compared to a current price of 円422.00 — trading 36.9% above its estimated fair value. The current Operating Margin % is 10.32%, which is 34% above median its 10-year median of 7.73 and 242.9% above the Steel industry median of 3.01. Nippon Denko Co's overall GF Score™ is 72/100 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 Nippon Denko Co (TSE:5563), the current Operating Margin % is 10.32% 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 Nippon Denko Co (TSE:5563) Overvalued in 2026?
Based on GuruFocus' analysis, Nippon Denko Co stock appears to be overvalued.
The current stock price of 円422.00 is trading 36.9% above its estimated GF Value™ of 円308.34.
GuruFocus considers Nippon Denko Co to be Significantly Overvalued.
Key valuation signals for TSE:5563:
Operating Margin %: 10.32% (34% above median its 10-year median of 7.73)
GF Value™: 円308.34 vs. price of 円422.00 (36.9% above fair value)
Industry Position: 242.9% above the Steel median (#154 of 611)
No single metric tells the full story. See the TSE:5563 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Nippon Denko Co Ltd is mainly engaged in the manufacturing and distribution of ferroalloys. In addition, it is also involved in the electric power generation. The company's core business activities are categorized into four segments: Ferroalloys, Functional Materials, Environment, and Other. The company serves a diverse range of markets including power companies, agricultural cooperatives, local governments and companies discharging industrial waste.
72GF 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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