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First Watch Restaurant GroupFWRG -2.44%75 Gross Margin % is 19.49% as of Jun. 2026, which is 3% below its 10-year median of 20.03. GuruFocus rates FWRG with a GF Score™ of 75/100 and a GF Value™ of $22.39 (Possible Value Trap). The stock has 5 warning signs investors should review. Among 354 Restaurants companies, First Watch Restaurant Group ranks worse than 86.16% on this metric.
First Watch Restaurant Group (NAS:FWRG) 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
First Watch Restaurant Group had a gross margin of 19.49% for the quarter that ended in Jun. 2026 => No sustainable 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.
First Watch Restaurant Group Gross Margin % Related Terms
First Watch Restaurant Group Gross Margin % Historical Data
* 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 Restaurants subindustry, First Watch Restaurant Group'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.
First Watch Restaurant Group Gross Margin % vs Restaurants Industry
For the Restaurants industry and Consumer Cyclical sector, First Watch Restaurant Group's Gross Margin % distribution charts can be found below:
* The bar in red indicates where First Watch Restaurant Group'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.
First Watch Restaurant Group (FWRG) has a Gross Margin % of 19.49% as of Jun. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on First Watch Restaurant Group and its competitors. This is near median its historical median of 20.03. Over the past decade, First Watch Restaurant Group's Gross Margin % has ranged from 8.73 to 21.32. According to the industry distribution chart, First Watch Restaurant Group ranks #305 out of 354 companies in the Restaurants industry, placing it in the top 86.2%.
Is First Watch Restaurant Group's Gross Margin % too high?
First Watch Restaurant Group's current Gross Margin % of 19.49% is near median its 10-year median of 20.03. Over the past 10 years, this metric has ranged from a low of 8.73 to a high of 21.32. The Restaurants industry median Gross Margin % is 45.65. First Watch Restaurant Group's value of 19.49% is 57.3% below this industry median. Based on the distribution chart, First Watch Restaurant Group ranks #305 out of 354 companies in the Restaurants industry, which is in the bottom quartile relative to peers. Overall, First Watch Restaurant Group has a GF Score™ of 75/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does First Watch Restaurant Group's Gross Margin % compare to SG and BLMN?
According to the Restaurants industry distribution chart, First Watch Restaurant Group ranks #305 out of 354 companies for Gross Margin %. This places First Watch Restaurant Group in the lower half of its industry. The industry median Gross Margin % is 45.65. First Watch Restaurant Group's value of 19.49% is 57.3% below this benchmark. Historically, First Watch Restaurant Group's own Gross Margin % has ranged from 8.73 to 21.32 over the past decade. While the company's 10-year median is 20.03 vs. the industry median of 45.65, First Watch Restaurant Group 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 Restaurants company?
The median Gross Margin % among Restaurants companies is 45.65, based on 354 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. First Watch Restaurant Group's current Gross Margin % of 19.49% is 57.3% 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 First Watch Restaurant Group and its competitors. For the Restaurants industry, the median Gross Margin % is 45.65 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. First Watch Restaurant Group's current Gross Margin % is 19.49%, which is near median its own 10-year median of 20.03. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is First Watch Restaurant Group stock overvalued right now?
Based on GuruFocus' analysis, First Watch Restaurant Group (FWRG) is currently considered Possible Value Trap. The stock's GF Value™ is $22.39, compared to a current price of $12.01 — trading 46.4% below its estimated fair value. The current Gross Margin % is 19.49%, which is near median its 10-year median of 20.03 and 57.3% below the Restaurants industry median of 45.65. First Watch Restaurant Group's overall GF Score™ is 75/100 with 5 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 First Watch Restaurant Group (FWRG), the current Gross Margin % is 19.49% as of Jun. 2026. 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 First Watch Restaurant Group (FWRG) Overvalued in 2026?
Based on GuruFocus' analysis, First Watch Restaurant Group stock appears to be undervalued.
The current stock price of $12.01 is trading 46.4% below its estimated GF Value™ of $22.39.
GuruFocus considers First Watch Restaurant Group to be Possible Value Trap.
Key valuation signals for FWRG:
Gross Margin %: 19.49% (near median its 10-year median of 20.03)
GF Value™: $22.39 vs. price of $12.01 (46.4% below fair value)
Industry Position: 57.3% below the Restaurants median (#305 of 354)
No single metric tells the full story. See the FWRG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
First Watch Restaurant Group Inc is a daytime restaurant concept serving made-to-order breakfast, brunch, and lunch using fresh ingredients. The company generates revenues from Restaurant sales and Franchise revenues. It generates maximum revenue from Restaurant sales.
75GF Score
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