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InvestHub.com's
Finance Dictionary and Glossary of Investment Terms

Pre-Tax Margin  

Definition 1.

The latest 12 months'' pre-tax income divided by the latest 12 months'' sales. A good measure of profitability, although it''s important to bear in mind what industry a company is in. Supermarket chains have low pre-tax margins and depend on volume, so there is no point comparing a grocery chain to an upscale specialty retailer, which will have higher margins.
 
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