Switch to:
GuruFocus has detected 3 Warning Signs with Dick's Sporting Goods Inc \$DKS.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Dick's Sporting Goods Inc (NYSE:DKS)
Cost of Goods Sold
\$5,675 Mil (TTM As of Apr. 2017)

Dick's Sporting Goods Inc's cost of goods sold for the three months ended in Apr. 2017 was \$1,283 Mil. Its cost of goods sold for the trailing twelve months (TTM) ended in Apr. 2017 was \$5,675 Mil.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Dick's Sporting Goods Inc's Gross Margin for the three months ended in Apr. 2017 was 29.69%.

Cost of Goods Sold is also directly linked to Inventory Turnover. Dick's Sporting Goods Inc's Inventory Turnover for the three months ended in Apr. 2017 was 0.72.

Definition

Cost of goods sold (COGS) refers to the Inventory costs of those goods a business has sold during a particular period.

Dick's Sporting Goods Inc Cost of Goods Sold for the trailing twelve months (TTM) ended in Apr. 2017 was 1370.479 (Jul. 2016 ) + 1257.504 (Oct. 2016 ) + 1763.669 (Jan. 2017 ) + 1283.387 (Apr. 2017 ) = \$5,675 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Explanation

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

Dick's Sporting Goods Inc's Gross Margin for the three months ended in Apr. 2017 is calculated as:

 Gross Margin = (Revenue - Cost of Goods Sold) / Revenue = (1825.252 - 1283.387) / 1825.252 = 29.69 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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.

Cost of Goods Sold is also directly linked to another concept called Inventory Turnover:

Dick's Sporting Goods Inc's Inventory Turnover for the three months ended in Apr. 2017 is calculated as:

 Inventory Turnover = Cost of Goods Sold / Average Inventory = 1283.387 / 1777.57 = 0.72

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher inventory turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate inventory turnover. An average inventory is a better indication.

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Dick's Sporting Goods Inc Annual Data

 Jan08 Jan09 Jan10 Jan11 Jan12 Jan13 Jan14 Jan15 Jan16 Jan17 COGS 2,730 2,946 3,196 3,422 3,617 3,999 4,269 4,728 5,088 5,556

Dick's Sporting Goods Inc Quarterly Data

 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 COGS 1,469 1,096 1,269 1,154 1,568 1,165 1,370 1,258 1,764 1,283
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to \$400 per referral. ( Learn More)