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Walgreen Company (NYSE:WAG)
COGS to Revenue
0.71 (As of Feb. 2014)

Walgreen Company's cost of goods sold for the three months ended in Feb. 2014 was $13,955 Mil. Its revenue for the three months ended in Feb. 2014 was $19,605 Mil.

Walgreen Company's COGS to Revenue for the three months ended in Feb. 2014 was 0.71.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Walgreen Company's Gross Margin for the three months ended in Feb. 2014 was 28.82%.


Definition

Walgreen Company's COGS to Revenue for the fiscal year that ended in Aug. 2013 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=51098 / 72217
=0.71

Walgreen Company's COGS to Revenue for the quarter that ended in Feb. 2014 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=13955 / 19605
=0.71

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

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

Walgreen Company's Gross Margin for the three months ended in Feb. 2014 is calculated as:

Gross Margin=1 - COGS to Revenue
=1 - Cost of Goods Sold / Revenue
=1 - 13955 / 19605
=28.82 %

* All numbers are in millions except for per share data and ratio. All numbers are in their own 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

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.

Walgreen Company Annual Data

Aug04Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13
cogs2rev 0.730.720.720.720.720.720.720.720.720.71

Walgreen Company Quarterly Data

Nov11Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14
cogs2rev 0.720.710.720.720.710.700.710.710.720.71
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