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DaVita HealthCare Partners Inc (NYSE:DVA)
Gross Profit
$3,738 Mil (TTM As of Mar. 2015)

DaVita HealthCare Partners Inc's gross profit for the three months ended in Mar. 2015 was $925 Mil. DaVita HealthCare Partners Inc's gross profit for the trailing twelve months (TTM) ended in Mar. 2015 was $3,738 Mil.

Gross Margin is calculated as gross profit divided by its revenue. DaVita HealthCare Partners Inc's gross profit for the three months ended in Mar. 2015 was $925 Mil. DaVita HealthCare Partners Inc's revenue for the three months ended in Mar. 2015 was $3,288 Mil. Therefore, DaVita HealthCare Partners Inc's Gross Margin for the quarter that ended in Mar. 2015 was 28.14%.

DaVita HealthCare Partners Inc had a gross margin of 28.14% for the quarter that ended in Mar. 2015 => Competition eroding margins

During the past 13 years, the highest Gross Margin of DaVita HealthCare Partners Inc was 35.46%. The lowest was 28.73%. And the median was 31.68%.


Definition

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

DaVita HealthCare Partners Inc'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
=12795.106 - 9119.305
=3,676

DaVita HealthCare Partners Inc's Gross Profit for the quarter that ended in Mar. 2015 is calculated as

Gross Profit (Q: Mar. 2015 )=Revenue - Cost of Goods Sold
=3287.965 - 2362.612
=925

DaVita HealthCare Partners Inc Gross Profit for the trailing twelve months (TTM) ended in Mar. 2015 was 925.951 (Jun. 2014 ) + 925.29 (Sep. 2014 ) + 961.556 (Dec. 2014 ) + 925.353 (Mar. 2015 ) = $3,738 Mil.

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

DaVita HealthCare Partners Inc's Gross Margin for the quarter that ended in Mar. 2015 is calculated as

Gross Margin (Q: Mar. 2015 )=Gross Profit (Q: Mar. 2015 ) / Revenue (Q: Mar. 2015 )
=(Revenue - Cost of Goods Sold) / Revenue
=925 / 3287.965
=28.14 %

* 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

DaVita HealthCare Partners Inc had a gross margin of 28.14% for the quarter that ended in Mar. 2015 => 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.

DaVita HealthCare Partners Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
Gross_Profit 9391,4901,6741,7401,8601,7922,3012,6073,5663,676

DaVita HealthCare Partners Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
Gross_Profit 764876857904935863926925962925
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