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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
Guangzhou Xiao Noodles Catering Management Co had a gross margin of 46.81% 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.
Guangzhou Xiao Noodles Catering Management Co Gross Margin % Related Terms
Guangzhou Xiao Noodles Catering Management Co 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.
Guangzhou Xiao Noodles Catering Management Co Gross Margin % Chart
Guangzhou Xiao Noodles Catering Management Co Annual Data
Trend
Dec22
Dec23
Dec24
Dec25
Gross Margin %
36.90
42.88
43.92
47.00
Guangzhou Xiao Noodles Catering Management Co Semi-Annual Data
HKSE:02408 vs MCD, SBUX, YUM: Gross Margin % Comparison
For the Restaurants subindustry, Guangzhou Xiao Noodles Catering Management Co'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.
Guangzhou Xiao Noodles Catering Management Co Gross Margin % vs Restaurants Industry
* 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.
Guangzhou Xiao Noodles Catering Management Co (HKSE:02408) has a Gross Margin % of 46.81% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Guangzhou Xiao Noodles Catering Management Co and its competitors. This is near median its historical median of 43.40. Over the past decade, Guangzhou Xiao Noodles Catering Management Co's Gross Margin % has ranged from 36.90 to 47.00. According to the industry distribution chart, Guangzhou Xiao Noodles Catering Management Co ranks #165 out of 353 companies in the Restaurants industry, placing it in the top 46.7%.
Is Guangzhou Xiao Noodles Catering Management Co's Gross Margin % too high?
Guangzhou Xiao Noodles Catering Management Co's current Gross Margin % of 46.81% is near median its 10-year median of 43.40. Over the past 10 years, this metric has ranged from a low of 36.90 to a high of 47.00. The Restaurants industry median Gross Margin % is 45.66. Guangzhou Xiao Noodles Catering Management Co's value of 46.81% is 2.5% above this industry median. Based on the distribution chart, Guangzhou Xiao Noodles Catering Management Co ranks #165 out of 353 companies in the Restaurants industry, which is above the industry midpoint. Overall, Guangzhou Xiao Noodles Catering Management Co has a GF Score™ of 18/100, reflecting its overall financial health beyond just this single metric.
How does Guangzhou Xiao Noodles Catering Management Co's Gross Margin % compare to MCD and SBUX?
According to the Restaurants industry distribution chart, Guangzhou Xiao Noodles Catering Management Co ranks #165 out of 353 companies for Gross Margin %. This puts Guangzhou Xiao Noodles Catering Management Co in the upper half of its industry. The industry median Gross Margin % is 45.66. Guangzhou Xiao Noodles Catering Management Co's value of 46.81% is 2.5% above this benchmark. Historically, Guangzhou Xiao Noodles Catering Management Co's own Gross Margin % has ranged from 36.90 to 47.00 over the past decade. While the company's 10-year median is 43.40 vs. the industry median of 45.66, Guangzhou Xiao Noodles Catering Management Co 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 a Restaurants company?
The median Gross Margin % among Restaurants companies is 45.66, based on 353 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. Guangzhou Xiao Noodles Catering Management Co's current Gross Margin % of 46.81% is 2.5% 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 Guangzhou Xiao Noodles Catering Management Co and its competitors. For the Restaurants industry, the median Gross Margin % is 45.66 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Guangzhou Xiao Noodles Catering Management Co's current Gross Margin % is 46.81%, which is near median its own 10-year median of 43.40. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Guangzhou Xiao Noodles Catering Management Co stock overvalued right now?
Guangzhou Xiao Noodles Catering Management Co (HKSE:02408) has a current Gross Margin % of 46.81%. The current Gross Margin % is 46.81%, which is near median its 10-year median of 43.40 and 2.5% above the Restaurants industry median of 45.66. Guangzhou Xiao Noodles Catering Management Co's overall GF Score™ is 18/100 with 1 warning sign 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 Guangzhou Xiao Noodles Catering Management Co (HKSE:02408), the current Gross Margin % is 46.81% 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.
Guangzhou Xiao Noodles Catering Management Co Business Description
Guangzhou Xiao Noodles Catering Management Co Ltd is a Chinese noodle restaurants operator in China and operates the Xiao Noodles brand domestically and overseas. It provides a diverse array of its Sichuan and Chongqing dishes throughout the day, encompassing breakfast, afternoon tea, and late-night snacks. The company operates self-operated restaurants and franchised restaurants in the Chinese Mainland, Hong Kong SAR and in Singapore. The self-operated restaurant operations generate revenue from dine-in service and delivery business; and franchised management generates revenue from royalty and franchising income and provision of service, and sales of food ingredients and restaurant supplies.
18GF Score
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