After-tax operating margin (NOPAT mgn)
Operating profit after a notional tax charge, as a percentage of revenue.
It is the numerator of return on invested capital expressed as a rate, so the two move together.
How it is computed here
Operating income x (1 - tax rate) / revenue x 100
Measured over the latest complete fiscal year, as filed. Filed under quality. Higher is the stronger reading, other things equal.
No published threshold exists for this figure, so this page prints none. Read it against the company's own history and its peers instead.
When it misleads
- The tax rate is a flat assumption applied to every company, not the effective rate from the filing.
- There is no cross-industry threshold worth printing. The peer percentile against companies in the same industry is the only defensible reading.
Questions
How is after-tax operating margin calculated?
Operating income x (1 - tax rate) / revenue x 100. Measured over the latest complete fiscal year, as filed.
What does after-tax operating margin tell a value investor?
It is the numerator of return on invested capital expressed as a rate, so the two move together.
When does after-tax operating margin mislead?
The tax rate is a flat assumption applied to every company, not the effective rate from the filing. There is no cross-industry threshold worth printing. The peer percentile against companies in the same industry is the only defensible reading.