Net margin

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Net margin(also known as Net Profit Margin) is a financial ratio measuring the efficiency of a business in translating sales into net income. Net\ Margin = \frac{Net\ Income}{Net\ Revenue}

Net margins vary greatly by industry. Firms in the distribution and sales industries such as Walmart typically have very low (2%) net margins. On the other hand, firms in industries with high barriers to entry and fixed costs will generally have higher net margins. Examples include technology firms such as Microsoft and consulting firms. Net margins in the telecom services industry hover around 10%.

More information: Sites like Yahoo Finance Yahoo Finance - Industry Info provide information about the net margins in may industries.

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