ReTo Eco-Solutions (ReTo Eco-Solutions) Gross Margin % : 5.79% (As of Dec. 2023)

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What is ReTo Eco-Solutions Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. ReTo Eco-Solutions's Gross Profit for the six months ended in Dec. 2023 was $0.12 Mil. ReTo Eco-Solutions's Revenue for the six months ended in Dec. 2023 was $2.00 Mil. Therefore, ReTo Eco-Solutions's Gross Margin % for the quarter that ended in Dec. 2023 was 5.79%.

Warning Sign:

ReTo Eco-Solutions Inc gross margin has been in long-term decline. The average rate of decline per year is -32%.

The historical rank and industry rank for ReTo Eco-Solutions's Gross Margin % or its related term are showing as below:

RETO' s Gross Margin % Range Over the Past 10 Years
Min: 6.49 Med: 30.79 Max: 57.37
Current: 6.49

During the past 9 years, the highest Gross Margin % of ReTo Eco-Solutions was 57.37%. The lowest was 6.49%. And the median was 30.79%.

RETO's Gross Margin % is ranked worse than
94.12% of 374 companies
in the Building Materials industry
Industry Median: 25.355 vs RETO: 6.49

ReTo Eco-Solutions had a gross margin of 5.79% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

The 5-Year average Growth Rate of Gross Margin for ReTo Eco-Solutions was -32.00% per year.

ReTo Eco-Solutions Gross Margin % Historical Data

The historical data trend for ReTo Eco-Solutions's Gross Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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ReTo Eco-Solutions Gross Margin % Chart

ReTo Eco-Solutions Annual Data

Trend

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

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30.79

23.96

10.72

12.47

6.49

ReTo Eco-Solutions Semi-Annual Data
	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Gross Margin %	Get a 7-Day Free Trial												14.53	12.98	12.05	7.62	5.79

Competitive Comparison of ReTo Eco-Solutions's Gross Margin %

For the Building Materials subindustry, ReTo Eco-Solutions's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

ReTo Eco-Solutions's Gross Margin % Distribution in the Building Materials Industry

For the Building Materials industry and Basic Materials sector, ReTo Eco-Solutions's Gross Margin % distribution charts can be found below:

* The bar in red indicates where ReTo Eco-Solutions's Gross Margin % falls into.

ReTo Eco-Solutions Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

ReTo Eco-Solutions's Gross Margin for the fiscal year that ended in Dec. 2023 is calculated as

Gross Margin % (A: Dec. 2023 )	=	Gross Profit (A: Dec. 2023 )	/	Revenue (A: Dec. 2023 )
	=	0.2	/	3.236
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(3.236 - 3.026)	/	3.236
	=	6.49 %

ReTo Eco-Solutions's Gross Margin for the quarter that ended in Dec. 2023 is calculated as

Gross Margin % (Q: Dec. 2023 )	=	Gross Profit (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	0.1	/	2.003
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(2.003 - 1.887)	/	2.003
	=	5.79 %

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.

ReTo Eco-Solutions (NAS:RETO) Gross Margin % 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

ReTo Eco-Solutions had a gross margin of 5.79% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.

ReTo Eco-Solutions Gross Margin % Related Terms

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ReTo Eco-Solutions (ReTo Eco-Solutions) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Building Materials » ReTo Eco-Solutions Inc (NAS:RETO) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

N/A

Address

C/o Beijing REIT Technology Development Co., Ltd., X-702, Runfengdeshangyuan, 60 Anli Road, Chaoyang District, Beijing, CHN, 100101

Website

http://www.retoeco.com

ReTo Eco-Solutions Inc is a manufacturer and distributor of eco-friendly construction materials and fly-ash, as well as equipment used to produce these eco-friendly construction materials. The company engaged in providing consultation, design, project implementation and construction of urban ecological environments for capturing, controlling and re-using rainwater. It operates through four segments namely Machinery and Equipment sales, Construction materials sales, Municipal Construction Projects, and Technology Consulting and other services. The company earns its revenue from Machinery and Equipment sales segment. Geographically, it derives a majority of its revenue from China.