Net Profit Margin

The profit as a percentage of net sales is referred to as the Net Profit Margin. It is business ratio used to evaluate the bottom line performance of a business against a period of time.

Net Profit Margin

Net Profit Margin

The net profit margin reflects the profitability of the company as a percentage of net sales. It is one of the performance ratios used in evaluating business. Interestingly, some consider it the most important ratio. These users of business ratios take a very simplistic approach towards business evaluation. 

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