Overhead efficiency trend (SG&A trend)
The change in selling and administrative costs as a share of revenue over three years. Negative means overhead is falling relative to sales.
Operating leverage shows up here first: revenue growing faster than the cost of supporting it.
How it is computed here
SG&A / revenue today minus SG&A / revenue three years ago, in percentage points
Computed across several filed fiscal years. Filed under quality. Lower 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
- Negative is the good direction, which inverts the usual reading.
- A company that cuts overhead by starving investment improves this number and damages itself.
- Reclassification between cost of revenue and overhead moves it with nothing changing.
Questions
How is overhead efficiency trend calculated?
SG&A / revenue today minus SG&A / revenue three years ago, in percentage points. Computed across several filed fiscal years.
What does overhead efficiency trend tell a value investor?
Operating leverage shows up here first: revenue growing faster than the cost of supporting it.
When does overhead efficiency trend mislead?
Negative is the good direction, which inverts the usual reading. A company that cuts overhead by starving investment improves this number and damages itself. Reclassification between cost of revenue and overhead moves it with nothing changing.