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Sunoco LP (NYSE:SUN)
Gross Profit
$1,794 Mil (TTM As of Jun. 2016)

Sunoco LP's gross profit for the three months ended in Jun. 2016 was $581 Mil. Sunoco LP's gross profit for the trailing twelve months (TTM) ended in Jun. 2016 was $1,794 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Sunoco LP's gross profit for the three months ended in Jun. 2016 was $581 Mil. Sunoco LP's revenue for the three months ended in Jun. 2016 was $4,052 Mil. Therefore, Sunoco LP's Gross Margin for the quarter that ended in Jun. 2016 was 14.33%.

Sunoco LP had a gross margin of 14.33% for the quarter that ended in Jun. 2016 => No sustainable competitive advantage

During the past 6 years, the highest Gross Margin of Sunoco LP was 11.63%. The lowest was 1.11%. And the median was 1.35%.


Definition

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

Sunoco LP's Gross Profit for the fiscal year that ended in Dec. 2015 is calculated as

Gross Profit (A: Dec. 2015 )=Revenue - Cost of Goods Sold
=16935.347 - 15477.183
=1,458

Sunoco LP's Gross Profit for the quarter that ended in Jun. 2016 is calculated as

Gross Profit (Q: Jun. 2016 )=Revenue - Cost of Goods Sold
=4052.167 - 3471.6
=581

Sunoco LP Gross Profit for the trailing twelve months (TTM) ended in Jun. 2016 was 381.147 (Sep. 2015 ) + 333.216 (Dec. 2015 ) + 498.743 (Mar. 2016 ) + 580.567 (Jun. 2016 ) = $1,794 Mil.

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

Sunoco LP's Gross Margin for the quarter that ended in Jun. 2016 is calculated as

Gross Margin (Q: Jun. 2016 )=Gross Profit (Q: Jun. 2016 ) / Revenue (Q: Jun. 2016 )
=(Revenue - Cost of Goods Sold) / Revenue
=581 / 4052.167
=14.33 %

* 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

Sunoco LP had a gross margin of 14.33% for the quarter that ended in Jun. 2016 => No sustainable 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.

Sunoco LP Annual Data

Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 000036435238101,458

Sunoco LP Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
Gross_Profit 222200441545381333499581
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