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Conn's Inc (NAS:CONN)
Gross Profit
$782 Mil (TTM As of Jul. 2016)

Conn's Inc's gross profit for the three months ended in Jul. 2016 was $189 Mil. Conn's Inc's gross profit for the trailing twelve months (TTM) ended in Jul. 2016 was $782 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Conn's Inc's gross profit for the three months ended in Jul. 2016 was $189 Mil. Conn's Inc's revenue for the three months ended in Jul. 2016 was $398 Mil. Therefore, Conn's Inc's Gross Margin for the quarter that ended in Jul. 2016 was 47.54%.

Conn's Inc had a gross margin of 47.54% for the quarter that ended in Jul. 2016 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Conn's Inc was 48.35%. The lowest was 37.25%. And the median was 41.02%.


Definition

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

Conn's Inc's Gross Profit for the fiscal year that ended in Jan. 2016 is calculated as

Gross Profit (A: Jan. 2016 )=Revenue - Cost of Goods Sold
=1613.178 - 833.126
=780

Conn's Inc's Gross Profit for the quarter that ended in Jul. 2016 is calculated as

Gross Profit (Q: Jul. 2016 )=Revenue - Cost of Goods Sold
=398.157 - 208.869
=189

Conn's Inc Gross Profit for the trailing twelve months (TTM) ended in Jul. 2016 was 192.332 (Oct. 2015 ) + 216.188 (Jan. 2016 ) + 184.647 (Apr. 2016 ) + 189.288 (Jul. 2016 ) = $782 Mil.

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

Conn's Inc's Gross Margin for the quarter that ended in Jul. 2016 is calculated as

Gross Margin (Q: Jul. 2016 )=Gross Profit (Q: Jul. 2016 ) / Revenue (Q: Jul. 2016 )
=(Revenue - Cost of Goods Sold) / Revenue
=189 / 398.157
=47.54 %

* 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

Conn's Inc had a gross margin of 47.54% for the quarter that ended in Jul. 2016 => 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 local exchange's currency.

Conn's Inc Annual Data

Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
Gross_Profit 288307368347326330382564708780

Conn's Inc Quarterly Data

Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16
Gross_Profit 161169176202178194192216185189
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