Gross Margin % is calculated as gross profit divided by its revenue. Sempra's Gross Profit for the
three
months ended in Dec. 2023 was $1,424 Mil. Sempra's Revenue for the
three
months ended in Dec. 2023 was $3,491 Mil. Therefore, Sempra's Gross Margin % for the quarter that ended in Dec. 2023 was 40.79%.
Warning Sign:
Sempra gross margin has been in long-term decline. The average rate of decline per year is -1.9%.
The historical rank and industry rank for Sempra's Gross Margin % or its related term are showing as below:
SRE'
s Gross Margin % Range Over the Past 10 Years
Min: 30.32 Med: 39.74 Max: 44.34
Current: 39.59
During the past 13 years, the highestGross Margin % of Sempra was 44.34%. The lowest was 30.32%. And the median was 39.74%.
SRE's Gross Margin % is ranked better than 69.78% of 503
companies
in the Utilities - Regulated industry
Industry Median: 28.6
vs SRE: 39.59
Sempra had a gross margin of 40.79% for the quarter that ended in Dec. 2023 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Sempra was -1.90% per year.
Sempra Gross Margin % Historical Data
The historical data trend for Sempra'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 Utilities - Diversified subindustry, Sempra'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.
Sempra's Gross Margin % Distribution in the Utilities - Regulated Industry
For the Utilities - Regulated industry and Utilities sector, Sempra's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Sempra'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.
Sempra (NYSE:SRE) 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
Sempra had a gross margin of 40.79% for the quarter that ended in Dec. 2023 => 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.
Sempra Gross Margin % Related Terms
Thank you for viewing the detailed overview of Sempra's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Sempra Energy serves one of the largest utility customer bases in the United States. It distributes natural gas and electricity in Southern California and owns 80% of Oncor, a transmission and distribution business in Texas. SoCalGas and San Diego Gas & Electric distribute gas to more than 20 million customers, while Oncor serves more than 10 million Texas customers. Sempra Infrastructure partners, of which Sempra holds a controlling ownership, owns and operates liquefied natural gas facilities in North America and infrastructure in Mexico.
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