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GuruFocus has detected 3 Warning Signs with Aspen Technology Inc \$AZPN.
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Aspen Technology Inc (NAS:AZPN)
COGS to Revenue
0.10 (As of Sep. 2016)

Aspen Technology Inc's cost of goods sold for the three months ended in Sep. 2016 was \$11.5 Mil. Its revenue for the three months ended in Sep. 2016 was \$120.1 Mil.

Aspen Technology Inc's COGS to Revenue for the three months ended in Sep. 2016 was 0.10.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Aspen Technology Inc's Gross Margin for the three months ended in Sep. 2016 was 90.42%.

Definition

Aspen Technology Inc's COGS to Revenue for the fiscal year that ended in Jun. 2016 is calculated as

 COGS to Revenue = Cost of Goods Sold / Revenue = 48.611 / 472.344 = 0.10

Aspen Technology Inc's COGS to Revenue for the quarter that ended in Sep. 2016 is calculated as

 COGS to Revenue = Cost of Goods Sold / Revenue = 11.506 / 120.05 = 0.10

* 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.

Aspen Technology Inc's Gross Margin for the three months ended in Sep. 2016 is calculated as:

 Gross Margin = 1 - COGS to Revenue = 1 - Cost of Goods Sold / Revenue = 1 - 11.506 / 120.05 = 90.42 %

* 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.

Aspen Technology Inc Annual Data

 Jun07 Jun08 Jun09 Jun10 Jun11 Jun12 Jun13 Jun14 Jun15 Jun16 cogs2rev 0.27 0.27 0.24 0.40 0.26 0.22 0.16 0.13 0.11 0.10

Aspen Technology Inc Quarterly Data

 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 cogs2rev 0.13 0.12 0.11 0.11 0.11 0.11 0.10 0.10 0.10 0.10
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