Gross Margin % is calculated as gross profit divided by its revenue. Neogen's Gross Profit for the
three
months ended in Feb. 2024 was $116.9 Mil. Neogen's Revenue for the
three
months ended in Feb. 2024 was $228.8 Mil. Therefore, Neogen's Gross Margin % for the quarter that ended in Feb. 2024 was 51.08%.
The historical rank and industry rank for Neogen's Gross Margin % or its related term are showing as below:
NEOG'
s Gross Margin % Range Over the Past 10 Years
Min: 45.91 Med: 47.05 Max: 50.97
Current: 50.97
During the past 13 years, the highestGross Margin % of Neogen was 50.97%. The lowest was 45.91%. And the median was 47.05%.
NEOG's Gross Margin % is ranked better than 56.02% of 216
companies
in the Medical Diagnostics & Research industry
Industry Median: 45.595
vs NEOG: 50.97
Neogen had a gross margin of 51.08% for the quarter that ended in Feb. 2024 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Neogen was 0.70% per year.
Neogen Gross Margin % Historical Data
The historical data trend for Neogen'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 Diagnostics & Research subindustry, Neogen'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.
Neogen's Gross Margin % Distribution in the Medical Diagnostics & Research Industry
For the Medical Diagnostics & Research industry and Healthcare sector, Neogen's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Neogen'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.
Neogen (NAS:NEOG) 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
Neogen had a gross margin of 51.08% for the quarter that ended in Feb. 2024 => Durable 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.
Neogen Gross Margin % Related Terms
Thank you for viewing the detailed overview of Neogen's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Neogen Corporation, headquartered in Lansing, Michigan, develops, manufactures, and markets various products for food and animal safety. In food safety (70% of post-merger sales), Neogen performs diagnostics to detect unintended substances in food and animal feed, such as pathogens, allergens, and drug residues, for food and feed processing companies. In animal safety (20% of post-merger sales), Neogen sells veterinary instruments, pharmaceuticals, disinfectants, and genomics tests for animals, including cattle, horses, and canines. Sales in the United States account for 60% of total revenue, while international markets, including Canada, Europe, Asia, and Latin America, account for the remaining 40%.
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