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Jack Henry & Associates Inc (NAS:JKHY)
Gross Profit
\$601 Mil (TTM As of Dec. 2016)

Jack Henry & Associates Inc's gross profit for the three months ended in Dec. 2016 was \$150 Mil. Jack Henry & Associates Inc's gross profit for the trailing twelve months (TTM) ended in Dec. 2016 was \$601 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Jack Henry & Associates Inc's gross profit for the three months ended in Dec. 2016 was \$150 Mil. Jack Henry & Associates Inc's revenue for the three months ended in Dec. 2016 was \$349 Mil. Therefore, Jack Henry & Associates Inc's Gross Margin for the quarter that ended in Dec. 2016 was 43.15%.

Jack Henry & Associates Inc had a gross margin of 43.15% for the quarter that ended in Dec. 2016 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Jack Henry & Associates Inc was 42.89%. The lowest was 40.16%. And the median was 41.79%.

Definition

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

Jack Henry & Associates Inc's Gross Profit for the fiscal year that ended in Jun. 2016 is calculated as

 Gross Profit (A: Jun. 2016 ) = Revenue - Cost of Goods Sold = 1354.646 - 773.651 = 581

Jack Henry & Associates Inc's Gross Profit for the quarter that ended in Dec. 2016 is calculated as

 Gross Profit (Q: Dec. 2016 ) = Revenue - Cost of Goods Sold = 348.553 - 198.146 = 150

Jack Henry & Associates Inc Gross Profit for the trailing twelve months (TTM) ended in Dec. 2016 was 138.913 (Mar. 2016 ) + 161.7 (Jun. 2016 ) + 150.265 (Sep. 2016 ) + 150.407 (Dec. 2016 ) = \$601 Mil.

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

Jack Henry & Associates Inc's Gross Margin for the quarter that ended in Dec. 2016 is calculated as

 Gross Margin (Q: Dec. 2016 ) = Gross Profit (Q: Dec. 2016 ) / Revenue (Q: Dec. 2016 ) = (Revenue - Cost of Goods Sold) / Revenue = 150 / 348.553 = 43.15 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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

Jack Henry & Associates Inc had a gross margin of 43.15% for the quarter that ended in Dec. 2016 => Durable competitive advantage

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Jack Henry & Associates Inc Annual Data

 Jun07 Jun08 Jun09 Jun10 Jun11 Jun12 Jun13 Jun14 Jun15 Jun16 Gross_Profit 286 307 299 345 399 424 477 519 536 581

Jack Henry & Associates Inc Quarterly Data

 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Gross_Profit 138 131 132 146 138 142 139 162 150 150
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