Forbes: Mai Iskander-Datta on operating margin indications

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When it comes to inflation, there’s no shortage of blame to go around. First, the pandemic broke the global supply chain. Then stimulus payments set off a frenzy of consumer spending at a time when finding toilet paper at the local grocery store wasn’t a given. But from the halls of Congress to Main Street, fingers also point at corporate America. Greedy companies, by this telling, have raised prices above and beyond their rising costs of production. Companies, of course, deny this. “Operating margin excludes financing costs,” Wayne State University finance professor Mai Iskander-Datta said. “Essentially, you’re trying to have a broader picture of company performance. You’re trying to see how they’re doing without considering financing. It separates financing and investment decision-making.”

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