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GuruFocus has detected 1 Warning Sign with Monro Muffler Brake Inc $MNRO.
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Monro Muffler Brake Inc (NAS:MNRO)
Cost of Goods Sold
$629 Mil (TTM As of Mar. 2017)

Monro Muffler Brake Inc's cost of goods sold for the three months ended in Mar. 2017 was $159 Mil. Its cost of goods sold for the trailing twelve months (TTM) ended in Mar. 2017 was $629 Mil.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Monro Muffler Brake Inc's Gross Margin for the three months ended in Mar. 2017 was 36.99%.

Cost of Goods Sold is also directly linked to Inventory Turnover. Monro Muffler Brake Inc's Inventory Turnover for the three months ended in Mar. 2017 was 1.14.


Definition

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

Monro Muffler Brake Inc Cost of Goods Sold for the trailing twelve months (TTM) ended in Mar. 2017 was 138.826 (Jun. 2016 ) + 148.587 (Sep. 2016 ) + 182.683 (Dec. 2016 ) + 158.788 (Mar. 2017 ) = $629 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.

Monro Muffler Brake Inc's Gross Margin for the three months ended in Mar. 2017 is calculated as:

Gross Margin=(Revenue - Cost of Goods Sold) / Revenue
=(252.011 - 158.788) / 252.011
=36.99 %

* 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:

Monro Muffler Brake Inc's Inventory Turnover for the three months ended in Mar. 2017 is calculated as:

* 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

Inventory, Inventory Turnover, Gross Margin, Revenue


Historical Data

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

Monro Muffler Brake Inc Annual Data

Mar08Mar09Mar10Mar11Mar12Mar13Mar14Mar15Mar16Mar17
COGS 265285333379410454511541558625

Monro Muffler Brake Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
COGS 146135137138146137139149183159
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