Switch to:
ConAgra Foods Inc (NYSE:CAG)
Gross Profit
$3,473 Mil (TTM As of Nov. 2014)

ConAgra Foods Inc's gross profit for the three months ended in Nov. 2014 was $889 Mil. ConAgra Foods Inc's gross profit for the trailing twelve months (TTM) ended in Nov. 2014 was $3,473 Mil.

Gross Margin is calculated as gross profit divided by its revenue. ConAgra Foods Inc's gross profit for the three months ended in Nov. 2014 was $889 Mil. ConAgra Foods Inc's revenue for the three months ended in Nov. 2014 was $4,150 Mil. Therefore, ConAgra Foods Inc's Gross Margin for the quarter that ended in Nov. 2014 was 21.41%.

ConAgra Foods Inc had a gross margin of 21.41% for the quarter that ended in Nov. 2014 => Competition eroding margins

During the past 13 years, the highest Gross Margin of ConAgra Foods Inc was 25.57%. The lowest was 13.13%. And the median was 21.17%.

Warning Sign:

ConAgra Foods Inc gross margin has been in long term decline. The average rate of decline per year is -2%.


Definition

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

ConAgra Foods Inc's Gross Profit for the fiscal year that ended in May. 2014 is calculated as

Gross Profit (A: May. 2014 )=Revenue - Cost of Goods Sold
=17702.6 - 13980.1
=3,723

ConAgra Foods Inc's Gross Profit for the quarter that ended in Nov. 2014 is calculated as

Gross Profit (Q: Nov. 2014 )=Revenue - Cost of Goods Sold
=4150 - 3261.5
=889

ConAgra Foods Inc Gross Profit for the trailing twelve months (TTM) ended in Nov. 2014 was 975.2 (Feb. 2014 ) + 905.5 (May. 2014 ) + 703.8 (Aug. 2014 ) + 888.5 (Nov. 2014 ) = $3,473 Mil.

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

ConAgra Foods Inc's Gross Margin for the quarter that ended in Nov. 2014 is calculated as

Gross Margin (Q: Nov. 2014 )=Gross Profit (Q: Nov. 2014 ) / Revenue (Q: Nov. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=889 / 4150
=21.41 %

* 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

ConAgra Foods Inc had a gross margin of 21.41% for the quarter that ended in Nov. 2014 => Competition eroding margins


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.

ConAgra Foods Inc Annual Data

May05May06May07May08May09May10May11May12May13May14
Gross_Profit 2,8342,5412,6932,7142,8413,0652,9142,8273,5603,723

ConAgra Foods Inc Quarterly Data

Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14Nov14
Gross_Profit 8718638749528311,015975906704889
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK