Series 79: Net Margin

Net Margin

Net margin, also called net profit margin, expresses what percentage of each dollar a company earns as revenue is turned into profit. Net margin is an excellent gauge of how effective a company is at turning revenue into profit. Like all profit margin metrics, it is best used either to compare a company’s performance over time or to compare the margins of companies in a single industry.

To compute net margin, you’ll need two numbers: the company’s re