Operating Margin

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Price: 2 572 GBX -1.68%

Market Cap: £8.3B

15.6%

Improving

by 0.4%

Operating Margin shows how much profit a company makes from its regular business activities after covering operating costs. It helps measure how efficiently the company turns sales into profit.

Operating Margin

15.6%

Operating Income

£455m

Revenue

£2.9B

Operating Margin shows how much profit a company makes from its regular business activities after covering operating costs. It helps measure how efficiently the company turns sales into profit.

Operating Margin

15.6%

Operating Income

GBX455m

Revenue

£2.9B

Peer Comparison

Country		Company	Market Cap	Operating Margin
UK		Smiths Group PLC LSE:SMIN	8.6B GBP	Loading...
US		General Electric Co NYSE:GE	310.3B USD	Loading...
DE		Siemens AG XETRA:SIE	197.7B EUR	Loading...
JP		Hitachi Ltd TSE:6501	23.1T JPY	Loading...
US		Honeywell International Inc NASDAQ:HON	140.1B USD	Loading...
US		3M Co NYSE:MMM	84.4B USD	Loading...
CN		CITIC Ltd HKEX:267	364.8B HKD	Loading...
US	R	Roper Technologies Inc F:ROP	33B EUR	Loading...
KR		Samsung C&T Corp KRX:028260	49.5T KRW	Loading...
HK		CK Hutchison Holdings Ltd HKEX:1	253.5B HKD	Loading...
HK		Jardine Matheson Holdings Ltd SGX:J36	21.6B USD	Loading...

Market Distribution

Min	-195 650%
30th Percentile	0%
Median	0.1%
70th Percentile	0.2%
Max	4 630.7%

Other Profitability Ratios

Smiths Group PLC
Glance View

Market Cap

8.3B GBX

Industry

Industrial Conglomerates

Smiths Group PLC, a hallmark of British industrial prowess, has consistently unfurled its wings across diverse fields, each woven with the same thread of precision engineering and innovation. Founded in the Victorian era, when steam and steel were the very veins of progress, Smiths Group has evolved to become a multinational conglomerate with footprints in diverse industries such as healthcare, energy, defense, and telecommunications. At its core, Smiths Group is driven by a quest for engineering excellence, which it channels through its five main divisions: John Crane, Smiths Detection, Smiths Medical, Smiths Interconnect, and Flex-Tek. Each division serves different markets, yet they all share the same mission of delivering detailed ingenuity and technological enhancement to address the intricate demands of modern-day enterprises. The company's revenue model is robustly anchored in designing, manufacturing, and servicing high-tech equipment essential in critical industries. For instance, John Crane provides mechanical seals and systems, filtration systems, and predictive digital analytics that are indispensable to the oil, gas, and chemical sectors, ensuring fluid dynamics that power the world’s industries are seamless and efficient. Smiths Detection specializes in advanced threat detection and screening technologies, a quintessential tool for upholding global security in transportation and critical infrastructure. Moreover, Smiths Medical contributes vital life-saving devices, from fluid management to critical care solutions, fortifying healthcare systems worldwide. Meanwhile, Smiths Interconnect focuses on high-speed, secure connectivity solutions, supporting communications across military and commercial arenas, while Flex-Tek supplies vital components to the aerospace, heating, and construction industries. Together, these divisions fashion a framework where Smiths Group thrives by continually innovating, optimizing operational efficiency, and expanding its global reach to meet the ever-evolving needs of their sectors.

View SMIN Analysis

SMIN Intrinsic Value

Overvaluation 27%

Intrinsic Value

Price

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

The AI Assistant may sometimes provide inaccurate information.

Make your own investment decisions or consult a licensed financial advisor.

Smiths Group PLC
LSE:SMIN

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Market Distribution

Other Profitability Ratios

Smiths Group PLC
Glance View

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Smiths Group PLC LSE:SMIN