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Allegiant Travel Co LLC (NAS:ALGT)
Gross Profit
$728 Mil (TTM As of Sep. 2015)

Allegiant Travel Co LLC's gross profit for the three months ended in Sep. 2015 was $180 Mil. Allegiant Travel Co LLC's gross profit for the trailing twelve months (TTM) ended in Sep. 2015 was $728 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Allegiant Travel Co LLC's gross profit for the three months ended in Sep. 2015 was $180 Mil. Allegiant Travel Co LLC's revenue for the three months ended in Sep. 2015 was $300 Mil. Therefore, Allegiant Travel Co LLC's Gross Margin for the quarter that ended in Sep. 2015 was 59.96%.

Allegiant Travel Co LLC had a gross margin of 59.96% for the quarter that ended in Sep. 2015 => Durable competitive advantage

During the past 14 years, the highest Gross Margin of Allegiant Travel Co LLC was 51.61%. The lowest was 27.13%. And the median was 41.89%.


Definition

Gross Profit is the different between the sale prices and the cost of buying or producing the goods.

Allegiant Travel Co LLC's Gross Profit for the fiscal year that ended in Dec. 2014 is calculated as

Gross Profit (A: Dec. 2014 )=Revenue - Cost of Goods Sold
=1137.046 - 575.609
=561

Allegiant Travel Co LLC's Gross Profit for the quarter that ended in Sep. 2015 is calculated as

Gross Profit (Q: Sep. 2015 )=Revenue - Cost of Goods Sold
=299.956 - 120.095
=180

Allegiant Travel Co LLC Gross Profit for the trailing twelve months (TTM) ended in Sep. 2015 was 139.694 (Dec. 2014 ) + 213.653 (Mar. 2015 ) + 194.826 (Jun. 2015 ) + 179.861 (Sep. 2015 ) = $728 Mil.

Gross Profit is the numerator in the calculation of Gross Margin:

Allegiant Travel Co LLC's Gross Margin for the quarter that ended in Sep. 2015 is calculated as

Gross Margin (Q: Sep. 2015 )=Gross Profit (Q: Sep. 2015 ) / Revenue (Q: Sep. 2015 )
=(Revenue - Cost of Goods Sold) / Revenue
=180 / 299.956
=59.96 %

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.


Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

Allegiant Travel Co LLC had a gross margin of 59.96% for the quarter that ended in Sep. 2015 => Durable competitive advantage


Related Terms

Cost of Goods Sold, Gross Margin, Revenue


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Allegiant Travel Co LLC Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 72152192288297301378450561789

Allegiant Travel Co LLC Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
Gross_Profit 102103141144127140214195180200
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