Deswell IndustriesDSWL +2.03%64 Gross Margin % is 23.44% as of Sep. 2025, which is 34% above its 10-year median of 17.44. GuruFocus rates DSWL with a GF Score™ of 64/100 and a GF Value™ of $2.17 (Significantly Overvalued). The stock has 7 warning signs investors should review. Among 2,450 Hardware companies, Deswell Industries ranks worse than 55.43% on this metric.
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
Deswell Industries had a gross margin of 23.44% for the quarter that ended in Sep. 2025 => 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.
Deswell Industries Gross Margin % Related Terms
Deswell Industries Gross Margin % Historical Data
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The historical data trend for Deswell Industries'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.
DSWL vs WBX, HOLO, IEHC: Gross Margin % Comparison
For the Electronic Components subindustry, Deswell Industries'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.
Deswell Industries Gross Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Deswell Industries's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Deswell Industries'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.
Deswell Industries (DSWL) has a Gross Margin % of 23.44% as of Sep. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Deswell Industries and its competitors. This is 34% above median its historical median of 17.44. Over the past decade, Deswell Industries' Gross Margin % has ranged from 15.42 to 22.37. According to the industry distribution chart, Deswell Industries ranks #1358 out of 2450 companies in the Hardware industry, placing it in the top 55.4%.
Is Deswell Industries' Gross Margin % too high?
Deswell Industries' current Gross Margin % of 23.44% is 34% above median its 10-year median of 17.44. Over the past 10 years, this metric has ranged from a low of 15.42 to a high of 22.37. The Hardware industry median Gross Margin % is 24.53. Deswell Industries' value of 23.44% is 4.4% below this industry median. Based on the distribution chart, Deswell Industries ranks #1358 out of 2450 companies in the Hardware industry, which is below the industry midpoint. Overall, Deswell Industries has a GF Score™ of 64/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Deswell Industries' Gross Margin % compare to WBX and HOLO?
According to the Hardware industry distribution chart, Deswell Industries ranks #1358 out of 2450 companies for Gross Margin %. This places Deswell Industries in the lower half of its industry. The industry median Gross Margin % is 24.53. Deswell Industries' value of 23.44% is 4.4% below this benchmark. Historically, Deswell Industries' own Gross Margin % has ranged from 15.42 to 22.37 over the past decade. While the company's 10-year median is 17.44 vs. the industry median of 24.53, Deswell Industries has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Hardware company?
The median Gross Margin % among Hardware companies is 24.53, based on 2,450 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Deswell Industries's current Gross Margin % of 23.44% is 4.4% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Deswell Industries and its competitors. For the Hardware industry, the median Gross Margin % is 24.53 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Deswell Industries's current Gross Margin % is 23.44%, which is 34% above median its own 10-year median of 17.44. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Deswell Industries stock overvalued right now?
Based on GuruFocus' analysis, Deswell Industries (DSWL) is currently considered Significantly Overvalued. The stock's GF Value™ is $2.17, compared to a current price of $3.76 — trading 73.3% above its estimated fair value. The current Gross Margin % is 23.44%, which is 34% above median its 10-year median of 17.44 and 4.4% below the Hardware industry median of 24.53. Deswell Industries' overall GF Score™ is 64/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Deswell Industries (DSWL), the current Gross Margin % is 23.44% as of Sep. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Deswell Industries (DSWL) Overvalued in 2026?
Based on GuruFocus' analysis, Deswell Industries stock appears to be overvalued.
The current stock price of $3.76 is trading 73.3% above its estimated GF Value™ of $2.17.
GuruFocus considers Deswell Industries to be Significantly Overvalued.
Key valuation signals for DSWL:
Gross Margin %: 23.44% (34% above median its 10-year median of 17.44)
GF Value™: $2.17 vs. price of $3.76 (73.3% above fair value)
Industry Position: 4.4% below the Hardware median (#1358 of 2450)
No single metric tells the full story. See the DSWL stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Deswell Industries Inc is engaged in the manufacturing and selling of injection-molded plastic parts and components. In addition, it also offers manufacturing services for electronic products and subassemblies and manufactures metallic molds and accessory parts for original equipment manufacturers and contract manufacturers. The company conducts all of its manufacturing activities at separate plastics, electronics and metallic operation factories located in the People's Republic of China. It operates through the Plastic Injection Molding and Electronic Products Assembling segments. The firm offers products such as automobile components, medical testing equipment, parts for audio equipment, av receivers, active subwoofers, digital system key sets, communication products and others.
64GF Score
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