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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
Arecor Therapeutics had a gross margin of -324.57% for the quarter that ended in Dec. 2025 => 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.
Arecor Therapeutics Gross Margin % Related Terms
Arecor Therapeutics Gross Margin % Historical Data
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The historical data trend for Arecor Therapeutics'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.
LSE:AREC vs VRTX, REGN, RVMD: Gross Margin % Comparison
For the Biotechnology subindustry, Arecor Therapeutics'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.
Arecor Therapeutics Gross Margin % vs Biotechnology Industry
For the Biotechnology industry and Healthcare sector, Arecor Therapeutics's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Arecor Therapeutics'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.
Arecor Therapeutics (LSE:AREC) has a Gross Margin % of -324.57% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Arecor Therapeutics and its competitors. Over the past decade, Arecor Therapeutics' Gross Margin % has ranged from 27.36 to 73.86. According to the industry distribution chart, Arecor Therapeutics ranks #263 out of 734 companies in the Biotechnology industry, placing it in the top 35.8%.
Is Arecor Therapeutics' Gross Margin % too high?
Arecor Therapeutics' current Gross Margin % is -324.57%. Over the past 10 years, this metric has ranged from a low of 27.36 to a high of 73.86. Based on the distribution chart, Arecor Therapeutics ranks #263 out of 734 companies in the Biotechnology industry, which is above the industry midpoint. Overall, Arecor Therapeutics has a GF Score™ of 37/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Arecor Therapeutics' Gross Margin % compare to VRTX and REGN?
According to the Biotechnology industry distribution chart, Arecor Therapeutics ranks #263 out of 734 companies for Gross Margin %. This puts Arecor Therapeutics in the upper half of its industry. The industry median Gross Margin % is 60.91. Historically, Arecor Therapeutics' own Gross Margin % has ranged from 27.36 to 73.86 over the past decade. 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 Biotechnology company?
The median Gross Margin % among Biotechnology companies is 60.91, based on 734 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. 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 Arecor Therapeutics and its competitors. For the Biotechnology industry, the median Gross Margin % is 60.91 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Arecor Therapeutics's current Gross Margin % is -324.57%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Arecor Therapeutics stock overvalued right now?
Based on GuruFocus' analysis, Arecor Therapeutics (LSE:AREC) is currently considered Significantly Overvalued. The stock's GF Value™ is £0.44, compared to a current price of £0.61 — trading 38.6% above its estimated fair value. The current Gross Margin % is -324.57%. Arecor Therapeutics' overall GF Score™ is 37/100 with 6 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 Arecor Therapeutics (LSE:AREC), the current Gross Margin % is -324.57% 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 Arecor Therapeutics (LSE:AREC) Overvalued in 2026?
Based on GuruFocus' analysis, Arecor Therapeutics stock appears to be overvalued.
The current stock price of £0.61 is trading 38.6% above its estimated GF Value™ of £0.44.
GuruFocus considers Arecor Therapeutics to be Significantly Overvalued.
Key valuation signals for LSE:AREC:
Gross Margin %: -324.57%
GF Value™: £0.44 vs. price of £0.61 (38.6% above fair value)
No single metric tells the full story. See the LSE:AREC stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Arecor Therapeutics PLC is a focused biopharmaceutical company. The company is transforming patient care by bringing medicines to market through the enhancement of existing therapeutic products. By applying an proprietary formulation technology platform, Aresta. It is developing a portfolio of proprietary products in diabetes and other indications and working with pharmaceutical and biotechnology companies to deliver enhanced reformulations of their therapies. Geographically, it operates in the UK, Europe (excl. UK) & Middle East, and the USA, out of which the majority is from the Europe (excl. UK) & Middle East.
37GF Score
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Gross Margin % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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