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Sturm, Ruger & Company (NYSE:RGR)
Gross Profit
$258.6 Mil (TTM As of Dec. 2013)

Sturm, Ruger & Company's gross profit for the three months ended in Dec. 2013 was $63.6 Mil. Sturm, Ruger & Company's gross profit for the trailing twelve months (TTM) ended in Dec. 2013 was $258.6 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Sturm, Ruger & Company's gross profit for the three months ended in Dec. 2013 was $63.6 Mil. Sturm, Ruger & Company's revenue for the three months ended in Dec. 2013 was $181.9 Mil. Therefore, Sturm, Ruger & Company's Gross Margin for the quarter that ended in Dec. 2013 was 34.98%.

Sturm, Ruger & Company had a gross margin of 34.98% for the quarter that ended in Dec. 2013 => Competition eroding margins

During the past 13 years, the highest Gross Margin of Sturm, Ruger & Company was 38.80%. The lowest was 14.46%. And the median was 32.62%.


Definition

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

Sturm, Ruger & Company's Gross Profit for the fiscal year that ended in Dec. 2013 is calculated as

Gross Profit (A: Dec. 2013 )=Revenue - Cost of Goods Sold
=688.276 - 429.671
=258.6

Sturm, Ruger & Company's Gross Profit for the quarter that ended in Dec. 2013 is calculated as

Gross Profit (Q: Dec. 2013 )=Revenue - Cost of Goods Sold
=181.9 - 118.268
=63.6

Sturm, Ruger & Company Gross Profit for the trailing twelve months (TTM) ended in Dec. 2013 was 61.309 (Mar. 2013 ) + 70.724 (Jun. 2013 ) + 62.94 (Sep. 2013 ) + 63.632 (Dec. 2013 ) = $258.6 Mil.

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

Sturm, Ruger & Company's Gross Margin for the quarter that ended in Dec. 2013 is calculated as

Gross Margin (Q: Dec. 2013 )=Gross Profit (Q: Dec. 2013 ) / Revenue (Q: Dec. 2013 )
=(Revenue - Cost of Goods Sold) / Revenue
=63.6 / 181.9
=34.98 %

* 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

Sturm, Ruger & Company had a gross margin of 34.98% for the quarter that ended in Dec. 2013 => 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.

Sturm, Ruger & Company Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 29.926.424.239.342.887.684.0111.8179.0258.6

Sturm, Ruger & Company Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Gross_Profit 29.130.241.845.142.649.561.370.762.963.6
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