Pretax Profit Margin

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Definition of 'Pretax Profit Margin'

A company's earnings before tax as a percentage of total sales or revenues. The higher the pre-tax profit margin, the more profitable the company. The trend of the pretax profit margin is as important as the figure itself, since it provides an indication of which way the company's profitability is headed.
Investopedia Says

Investopedia explains 'Pretax Profit Margin'

For example, suppose that Company A has earnings before tax of $10 million and total sales of $100 million in a given fiscal year. It has a pretax margin of 10%. The profit margin figure also enables profitability to be compared across companies with significant differences in size and scale. Company B, which has $500 million in sales and $40 million in pretax earnings may have substantially higher profitability than company A in dollar terms, but has a lower pretax profit margin of 8%.
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'Pretax Profit Margin'

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    ... profit. ... Pretax Profit Margin - Again many investment analysts prefer to use a pretax
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  • Profitability Indicator Ratios: Effective Tax Rate | Investopedia

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    ... some financial analysts prefer to use the operating or pretax profit figures instead
    of ... argue that any event that improves a company's net profit margin is a ...

  • Find Investment Quality In The Income Statement

    http://www.investopedia.com/articles/stocks/06/advincome.asp
    ... The term margin is used to express the comparison of four important levels of profit
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  • IBM Is A Profit Machine

    http://stocks.investopedia.com/stock-analysis/2009/IBM-Is-A-Profit-Machine-IBM-HPQ-EMC0720.aspx
    ... global technology services, posted the next highest margin of 14.9% and pretax income
    improved ... digit revenue declines and more mixed profit growth trends. ...

  • Smaller Investment Banks Offer Big Potential

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    ... The company is highly profitable with a 35% pretax profit margin, and its 2008
    per-employee revenue of $1 million was actually better than Goldman Sachs during ...

  • 3 Undervalued Stocks Ready to Run

    http://stocks.investopedia.com/stock-analysis/moneyshow/3UndervaluedStocksReadytoRun.aspx
    ... firm. The higher the pretax margin, the more profitable the company. Pretax
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  • A Grocery Store Above The Rest

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    ... performance improvement is attributed to the omission of pretax goodwill impairments ...
    Safeway operates at a fairly consistent gross profit margin of around 28%. ...

  • Understanding The Income Statement

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    ... more stable a company's gross margin, the greater ... SG&A from a company's gross profit
    produces operating ... Pretax Income: Another carefully watched indicator of ...

  • Plans The Small-Business Owner Can Establish

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    ... If you are unable to determine your profit margin from year to year, you may find ...
    referred to as salary-deferral contributions, are made on a pretax basis from ...

  • The 4 R's Of Investing In Retail

    http://www.investopedia.com/articles/stocks/10/the-four-rs-of-retail.asp
    ... return on investment, which is the gross margin profit on the ... After all, ROCE is
    a pretax look at its return on ... fact it made close to $1 billion in net profit. ...

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