Operating Margin - Sixt SE (XBER:SIX2)

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Price: 69.25 EUR -0.36%

Market Cap: 3.3B EUR

13.3%

Current

17%

Average

6.5%

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

13.3%

Operating Profit

563.2m

Revenue

4.2B

Operating Margin Across Competitors

Country		Company	Market Cap	Operating Margin
DE		Sixt SE XETRA:SIX2	3.3B EUR	13%
US		Uber Technologies Inc NYSE:UBER	169B USD	9%
US		Old Dominion Freight Line Inc NASDAQ:ODFL	33.4B USD	25%
CN	D	DiDi Global Inc OTC:DIDIY	26.5B USD	1%
SG		Grab Holdings Ltd NASDAQ:GRAB	21.2B USD	5%
US		J B Hunt Transport Services Inc NASDAQ:JBHT	19B USD	7%
US		XPO Logistics Inc NYSE:XPO	16.5B USD	9%
CN		Full Truck Alliance Co Ltd NYSE:YMM	11.7B USD	29%
US		U-Haul Holding Co NYSE:UHAL	10.1B USD	11%
US	A	Amerco F:AUK	8.4B EUR	11%
US		Knight-Swift Transportation Holdings Inc NYSE:KNX	8.7B USD	4%

Sixt SE
Glance View

Economic Moat

None

Market Cap

3.3B EUR

Industry

Road & Rail

Nestled in the post-war era of Bavaria, Sixt SE emerged as a small car rental operation founded by Martin Sixt in 1912. Over the ensuing decades, the company expanded beyond its humble roots, riding Germany's economic surge to become a formidable player in the global mobility services sector. Today, Sixt SE, headquartered in Pullach, Germany, plays in the big leagues, offering a spectrum of services that stretch far beyond simple car rentals. This expansion has been powered by the company's keen embrace of innovation and technology, allowing it to offer flexible, customer-oriented solutions such as car-sharing and long-term leasing – catering to both private customers and corporate clients. By integrating digital technologies into its services, Sixt has not only streamlined the car rental process but transformed it into a seamless experience that appeals to tech-savvy travelers. Sixt's business model revolves primarily around their rental and leasing services, where the revenue engine hums thanks to a robust fleet of diverse vehicle options ranging from economy cars to luxury sedans. Leveraging a mix of owned and leased car inventory, Sixt skilfully manages vehicle life cycles to maximize asset utilization and profitability. The company’s international reach adds another layer of resilience, minimizing risks tied to any single market. In recent years, Sixt has bolstered its revenue streams by integrating its offerings into mobility platforms like Sixt One. This shift has not only broadened its customer base but also diversified its income sources, ensuring steady growth even amidst changing transportation trends. The continuous adaptation to market demands, coupled with a sharp focus on customer satisfaction, sets Sixt SE as a forward-thinking leader in the competitive landscape of global transportation services.

View SIX2 Analysis

SIX2 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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Sixt SE
XBER:SIX2