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Clearfield Inc (NAS:CLFD)
Gross Profit
$26.92 Mil (TTM As of Jun. 2014)

Clearfield Inc's gross profit for the three months ended in Jun. 2014 was $6.04 Mil. Clearfield Inc's gross profit for the trailing twelve months (TTM) ended in Jun. 2014 was $26.92 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Clearfield Inc's gross profit for the three months ended in Jun. 2014 was $6.04 Mil. Clearfield Inc's revenue for the three months ended in Jun. 2014 was $14.36 Mil. Therefore, Clearfield Inc's Gross Margin for the quarter that ended in Jun. 2014 was 42.08%.

Clearfield Inc had a gross margin of 42.08% for the quarter that ended in Jun. 2014 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Clearfield Inc was 46.43%. The lowest was -542.66%. And the median was 28.67%.


Definition

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

Clearfield Inc's Gross Profit for the fiscal year that ended in Sep. 2013 is calculated as

Gross Profit (A: Sep. 2013 )=Revenue - Cost of Goods Sold
=53.353 - 31.364
=21.99

Clearfield Inc's Gross Profit for the quarter that ended in Jun. 2014 is calculated as

Gross Profit (Q: Jun. 2014 )=Revenue - Cost of Goods Sold
=14.363 - 8.319
=6.04

Clearfield Inc Gross Profit for the trailing twelve months (TTM) ended in Jun. 2014 was 8.221 (Sep. 2013 ) + 6.938 (Dec. 2013 ) + 5.721 (Mar. 2014 ) + 6.043 (Jun. 2014 ) = $26.92 Mil.

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

Clearfield Inc's Gross Margin for the quarter that ended in Jun. 2014 is calculated as

Gross Margin (Q: Jun. 2014 )=Gross Profit (Q: Jun. 2014 ) / Revenue (Q: Jun. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=6.04 / 14.363
=42.08 %

* 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

Clearfield Inc had a gross margin of 42.08% for the quarter that ended in Jun. 2014 => 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.

Clearfield Inc Annual Data

Mar05Mar06Mar07Sep07Sep08Sep09Sep10Sep11Sep12Sep13
Gross_Profit 2.694.515.273.227.858.879.1414.6615.2921.99

Clearfield Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Gross_Profit 2.724.564.223.924.225.638.226.945.726.04
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