Operating Margin AnalysisOperating Margin shows how much operating income a company makes on each dollar of sales. It is one of the profitability indicators which helps analysts to understand whether the firm is successful or not making money from everyday operations.
Operating Margin Over Time Pattern
About Operating MarginA good Operating Margin is required for a company to be able to pay for its fixed costs or pay out its debt which implies that the higher the margin, the better. This ratio is most effective in evaluating the earning potential of a company over time when comparing it against firm's competitors.
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Best Buy Operating Margin Assessment
Based on recorded statements Best Buy Co has Operating Margin of 6.25%. This is much higher than that of the Consumer Cyclical sector, and significantly higher than that of Specialty Retail industry, The Operating Margin for all stocks is over 1000% lower than the firm.