Operating Margin - GMK Noril'skiy Nikel' PAO (MOEX:GMKN)

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Price: 141.64 RUB 0.81%

Market Cap: 2.2T RUB

31.6%

Current

40%

Average

5.4%

Industry

Operating Margin represents how efficiently a company is able to generate profit through its core operations.

Higher ratios are generally better, illustrating the company is efficient in its operations and is good at turning sales into profits.

Operating Margin

31.6%

Operating Profit

384.7B

Revenue

1.2T

Operating Margin Across Competitors

Country		Company	Market Cap	Operating Margin
RU		GMK Noril'skiy Nikel' PAO MOEX:GMKN	2.2T RUB	32%
AU		Rio Tinto Ltd ASX:RIO	232.3B AUD	26%
AU		BHP Group Ltd ASX:BHP	225.1B AUD	38%
UK		Rio Tinto PLC LSE:RIO	94.6B GBP	26%
MX		Grupo Mexico SAB de CV BMV:GMEXICOB	1.3T MXN	45%
SA		Saudi Arabian Mining Company SJSC SAU:1211	248.9B SAR	23%
CH		Glencore PLC LSE:GLEN	46.4B GBP	1%
CN		CMOC Group Ltd SSE:603993	392.8B CNY	16%
CN	C	China Molybdenum Co Ltd OTC:CMCLF	49.7B USD	16%
UK		Anglo American PLC LSE:AAL	34.5B GBP	16%
ZA	A	African Rainbow Minerals Ltd JSE:ARI	37.6B Zac	-5%

GMK Noril'skiy Nikel' PAO
Glance View

Market Cap

2.2T RUB

Industry

Metals & Mining

In the frostbitten expanses of Russia's Siberian wilderness lies GMK Noril'skiy Nikel' PAO, commonly known as Norilsk Nickel, a titan in the world of mining and metallurgy. Emerging from the profound depths of the mineral-rich Norilsk region, the company stands as a monumental producer of nickel and palladium, which together form the backbone of its revenue streams. Norilsk Nickel’s operations are an intricate dance of exploration, extraction, and refining, with a primary focus on nickel, accounting for the lion's share of its outputs. This isn’t just any nickel—the company's metallurgical prowess ensures the production of high-purity nickel, which is essential for manufacturing stainless steel and a plethora of high-tech applications. Palladium, another gemstone in its portfolio, gushes forth primarily from the company’s subsidiaries, propelling Norilsk to a leading position in the global supply of this sought-after metal, indispensable in catalytic converters and various electronics. Norilsk's operations mirror an industrial ecosystem where each moving part is indispensable to the whole. Embedded deep within its Siberian roots, the company’s vertically integrated model ensures an efficient continuum from mining to the marketing of its precious metals. This self-sufficient structure not only buffers Norilsk against the turbulent tides of commodity pricing but also solidifies its place as a low-cost producer in the global realm. Furthermore, it invests substantially in research and technology innovations, constantly honing its processes to meet the ever-evolving demands of sustainability and resource efficiency. In a world gravitating towards green technologies, Norilsk’s assets are critical, reinforcing its role in enabling the energy transition through its investments in battery technology and emissions reduction. Thus, Norilsk Nickel doesn’t merely extract precious metals from the Earth; it molds them into the economic pulse of industries worldwide.

View GMKN Analysis

GMKN Intrinsic Value

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.

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GMK Noril'skiy Nikel' PAO
MOEX:GMKN