Gross Margin % is calculated as gross profit divided by its revenue. Maximus's Gross Profit for the
three
months ended in Dec. 2023 was $300 Mil. Maximus's Revenue for the
three
months ended in Dec. 2023 was $1,327 Mil. Therefore, Maximus's Gross Margin % for the quarter that ended in Dec. 2023 was 22.61%.
Warning Sign:
Maximus Inc gross margin has been in long-term decline. The average rate of decline per year is -3.3%.
The historical rank and industry rank for Maximus's Gross Margin % or its related term are showing as below:
MMS'
s Gross Margin % Range Over the Past 10 Years
Min: 20.29 Med: 23.32 Max: 26.58
Current: 21.75
During the past 13 years, the highestGross Margin % of Maximus was 26.58%. The lowest was 20.29%. And the median was 23.32%.
MMS's Gross Margin % is ranked worse than 73.04% of 994
companies
in the Business Services industry
Industry Median: 34.85
vs MMS: 21.75
Maximus had a gross margin of 22.61% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Maximus was -3.30% per year.
Maximus Gross Margin % Historical Data
The historical data trend for Maximus'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.
For the Specialty Business Services subindustry, Maximus'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.
Maximus Gross Margin % Distribution
For the Business Services industry and Industrials sector, Maximus's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Maximus's Gross Margin % falls into.
* 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.
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.
Maximus (NYSE:MMS) 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
Maximus had a gross margin of 22.61% for the quarter that ended in Dec. 2023 => Competition eroding margins
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.
Maximus Gross Margin % Related Terms
Thank you for viewing the detailed overview of Maximus's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Maximus Inc is an operator of government health and human services programs in the United States, United Kingdom, Canada, Australia, and Saudi Arabia. The company offers business solutions to improve the cost-effectiveness, efficiency, and quality of government-sponsored benefit programs, such as Medicaid, Medicare, Health Insurance BC, and child support programmes. Most of its revenue is derived from long-term contractual arrangements with governments around the world. The company generates maximum revenue from the U.S. Federal Services segment.
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