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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
Petro-king Oilfield Services had a gross margin of 77.82% for the quarter that ended in Dec. 2025 => Durable 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.
Petro-king Oilfield Services Gross Margin % Related Terms
Petro-king Oilfield Services 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:02178 vs SLB, BKR, FTI: Gross Margin % Comparison
For the Oil & Gas Equipment & Services subindustry, Petro-king Oilfield Services'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.
Petro-king Oilfield Services Gross Margin % vs Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Petro-king Oilfield Services's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Petro-king Oilfield Services'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.
Petro-king Oilfield Services (HKSE:02178) has a Gross Margin % of 77.82% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Petro-king Oilfield Services and its competitors. This is 17% above median its historical median of 66.61. Over the past decade, Petro-king Oilfield Services' Gross Margin % has ranged from 24.26 to 77.00. According to the industry distribution chart, Petro-king Oilfield Services ranks #46 out of 870 companies in the Oil & Gas industry, placing it in the top 5.3%.
Is Petro-king Oilfield Services' Gross Margin % too high?
Petro-king Oilfield Services' current Gross Margin % of 77.82% is 17% above median its 10-year median of 66.61. Over the past 10 years, this metric has ranged from a low of 24.26 to a high of 77.00. The Oil & Gas industry median Gross Margin % is 25.96. Petro-king Oilfield Services' value of 77.82% is 199.8% above this industry median. Based on the distribution chart, Petro-king Oilfield Services ranks #46 out of 870 companies in the Oil & Gas industry, which is in the top quartile — a strong position relative to peers. Overall, Petro-king Oilfield Services has a GF Score™ of 32/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Petro-king Oilfield Services' Gross Margin % compare to SLB and BKR?
According to the Oil & Gas industry distribution chart, Petro-king Oilfield Services ranks #46 out of 870 companies for Gross Margin %. This places Petro-king Oilfield Services in the top 5% of its industry — outperforming the majority of peers. The industry median Gross Margin % is 25.96. Petro-king Oilfield Services' value of 77.82% is 199.8% above this benchmark. Historically, Petro-king Oilfield Services' own Gross Margin % has ranged from 24.26 to 77.00 over the past decade. While the company's 10-year median is 66.61 vs. the industry median of 25.96, Petro-king Oilfield Services has consistently been above 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 an Oil & Gas company?
The median Gross Margin % among Oil & Gas companies is 25.96, based on 870 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. Petro-king Oilfield Services's current Gross Margin % of 77.82% is 199.8% above 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 Petro-king Oilfield Services and its competitors. For the Oil & Gas industry, the median Gross Margin % is 25.96 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Petro-king Oilfield Services's current Gross Margin % is 77.82%, which is 17% above median its own 10-year median of 66.61. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Petro-king Oilfield Services stock overvalued right now?
Based on GuruFocus' analysis, Petro-king Oilfield Services (HKSE:02178) is currently considered Significantly Overvalued. The stock's GF Value™ is HK$0.05, compared to a current price of HK$0.22 — trading 332% above its estimated fair value. The current Gross Margin % is 77.82%, which is 17% above median its 10-year median of 66.61 and 199.8% above the Oil & Gas industry median of 25.96. Petro-king Oilfield Services' overall GF Score™ is 32/100 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 Petro-king Oilfield Services (HKSE:02178), the current Gross Margin % is 77.82% 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 Petro-king Oilfield Services (HKSE:02178) Overvalued in 2026?
Based on GuruFocus' analysis, Petro-king Oilfield Services stock appears to be overvalued.
The current stock price of HK$0.22 is trading 332% above its estimated GF Value™ of HK$0.05.
GuruFocus considers Petro-king Oilfield Services to be Significantly Overvalued.
Key valuation signals for HKSE:02178:
Gross Margin %: 77.82% (17% above median its 10-year median of 66.61)
GF Value™: HK$0.05 vs. price of HK$0.22 (332% above fair value)
Industry Position: 199.8% above the Oil & Gas median (#46 of 870)
No single metric tells the full story. See the HKSE:02178 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Petro-king Oilfield Services Ltd provides oilfield and gas field technology services covering various stages in the life cycle of oilfields and gas fields including production enhancement, drilling, consultancy and integrated project management with auxiliary activities in the trading of oilfield and gas field related products. It has two reportable segments namely Oilfield project tools and services; and Consultancy services. Oilfield project tools and services include drilling work, production enhancement work, and well-completion work. It generates majority of its revenue from the Oilfield project tools and services segment. Geographically, the company operates in the People's Republic of China (PRC), the Middle East, and other countries, and generates majority of its revenue from PRC.
32GF Score
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