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Putian Communication Group (HKSE:01720) 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
Putian Communication Group had a gross margin of 20.67% for the quarter that ended in Dec. 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.
Putian Communication Group Gross Margin % Related Terms
Putian Communication 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.
HKSE:01720 vs CSCO, MSI, HPE: Gross Margin % Comparison
For the Communication Equipment subindustry, Putian Communication 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.
Putian Communication Group Gross Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Putian Communication Group's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Putian Communication 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.
Putian Communication Group (HKSE:01720) has a Gross Margin % of 20.67% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Putian Communication Group and its competitors. This is 10% below median its historical median of 22.94. Over the past decade, Putian Communication Group's Gross Margin % has ranged from 20.49 to 25.03. According to the industry distribution chart, Putian Communication Group ranks #1467 out of 2454 companies in the Hardware industry, placing it in the top 59.8%.
Is Putian Communication Group's Gross Margin % too high?
Putian Communication Group's current Gross Margin % of 20.67% is 10% below median its 10-year median of 22.94. Over the past 10 years, this metric has ranged from a low of 20.49 to a high of 25.03. The Hardware industry median Gross Margin % is 24.52. Putian Communication Group's value of 20.67% is 15.7% below this industry median. Based on the distribution chart, Putian Communication Group ranks #1467 out of 2454 companies in the Hardware industry, which is below the industry midpoint. Overall, Putian Communication Group has a GF Score™ of 50/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Putian Communication Group's Gross Margin % compare to CSCO and MSI?
According to the Hardware industry distribution chart, Putian Communication Group ranks #1467 out of 2454 companies for Gross Margin %. This places Putian Communication Group in the lower half of its industry. The industry median Gross Margin % is 24.52. Putian Communication Group's value of 20.67% is 15.7% below this benchmark. Historically, Putian Communication Group's own Gross Margin % has ranged from 20.49 to 25.03 over the past decade. While the company's 10-year median is 22.94 vs. the industry median of 24.52, Putian Communication 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 Hardware company?
The median Gross Margin % among Hardware companies is 24.52, based on 2,454 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. Putian Communication Group's current Gross Margin % of 20.67% is 15.7% 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 Putian Communication Group and its competitors. For the Hardware industry, the median Gross Margin % is 24.52 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Putian Communication Group's current Gross Margin % is 20.67%, which is 10% below median its own 10-year median of 22.94. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Putian Communication Group stock overvalued right now?
Based on GuruFocus' analysis, Putian Communication Group (HKSE:01720) is currently considered Significantly Overvalued. The stock's GF Value™ is HK$0.08, compared to a current price of HK$0.39 — trading 387.5% above its estimated fair value. The current Gross Margin % is 20.67%, which is 10% below median its 10-year median of 22.94 and 15.7% below the Hardware industry median of 24.52. Putian Communication Group's overall GF Score™ is 50/100 with 4 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 Putian Communication Group (HKSE:01720), the current Gross Margin % is 20.67% as of Dec. 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 Putian Communication Group (HKSE:01720) Overvalued in 2026?
Based on GuruFocus' analysis, Putian Communication Group stock appears to be overvalued.
The current stock price of HK$0.39 is trading 387.5% above its estimated GF Value™ of HK$0.08.
GuruFocus considers Putian Communication Group to be Significantly Overvalued.
Key valuation signals for HKSE:01720:
Gross Margin %: 20.67% (10% below median its 10-year median of 22.94)
GF Value™: HK$0.08 vs. price of HK$0.39 (387.5% above fair value)
Industry Position: 15.7% below the Hardware median (#1467 of 2454)
No single metric tells the full story. See the HKSE:01720 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Putian Communication Group Ltd is engaged in the production and sale of cable and communication products in the PRC. The group has three operating segments. The data and communications cables segment produces copper-based electric cables used in power transmission and network cabling, while the optical fibers and optical fiber cables segment manufactures fiber optic products used in telecommunications and network systems. The structured cabling system products segment provides optical and copper jumper wires, distribution components, and related intelligent building cabling products. It derives the majority of its revenue from the data and communications cables segment. The majority of the group's revenue is generated from customers located in the PRC.
50GF Score
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