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GuruFocus has detected 1 Warning Sign with Adecoagro SA \$AGRO.
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COGS-to-Revenue
0.72 (As of Dec. 2016)

Adecoagro SA's cost of goods sold for the three months ended in Dec. 2016 was \$249.7 Mil. Its revenue for the three months ended in Dec. 2016 was \$349.0 Mil.

Adecoagro SA's COGS to Revenue for the three months ended in Dec. 2016 was 0.72.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Adecoagro SA's Gross Margin for the three months ended in Dec. 2016 was 28.45%.

Definition

Adecoagro SA's COGS to Revenue for the fiscal year that ended in Dec. 2016 is calculated as

 COGS to Revenue = Cost of Goods Sold / Revenue = 678.581 / 988.85 = 0.69

Adecoagro SA's COGS to Revenue for the quarter that ended in Dec. 2016 is calculated as

 COGS to Revenue = Cost of Goods Sold / Revenue = 249.716 / 348.985 = 0.72

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

Explanation

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.

Adecoagro SA's Gross Margin for the three months ended in Dec. 2016 is calculated as:

 Gross Margin = 1 - COGS to Revenue = 1 - Cost of Goods Sold / Revenue = 1 - 249.716 / 348.985 = 28.45 %

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

A company that has a moat can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have moats.

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.