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Porta CommunicationsLSE:PTCM Gross Margin % is 89.40% as of Dec. 2018, which is 6% above its 10-year median of 84.15. The stock has 4 warning signs investors should review.
Porta Communications (LSE:PTCM) 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
Porta Communications had a gross margin of 89.40% for the quarter that ended in Dec. 2018 => 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.
Porta Communications Gross Margin % Related Terms
Porta Communications Gross Margin % Historical Data
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The historical data trend for Porta Communications'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.
For the Advertising Agencies subindustry, Porta Communications'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.
Porta Communications Gross Margin % vs Media - Diversified Industry
For the Media - Diversified industry and Communication Services sector, Porta Communications's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Porta Communications'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.
Porta Communications (LSE:PTCM) has a Gross Margin % of 89.40% as of Dec. 2018. Gross margin is the ratio of total gross profit to net sales. View historical data on Porta Communications and its competitors. This is near median its historical median of 84.15. Over the past decade, Porta Communications' Gross Margin % has ranged from 55.27 to 96.17.
Is Porta Communications' Gross Margin % too high?
Porta Communications' current Gross Margin % of 89.40% is near median its 10-year median of 84.15. Over the past 10 years, this metric has ranged from a low of 55.27 to a high of 96.17. The Media - Diversified industry median Gross Margin % is 38.96. Porta Communications' value of 89.40% is 129.5% above this industry median.
How does Porta Communications' Gross Margin % compare to NWCN and ADMG?
Porta Communications' Gross Margin % of 89.40% can be compared against companies in the Media - Diversified industry. The industry median Gross Margin % is 38.96. Porta Communications' value of 89.40% is 129.5% above this benchmark. Historically, Porta Communications' own Gross Margin % has ranged from 55.27 to 96.17 over the past decade. While the company's 10-year median is 84.15 vs. the industry median of 38.96, Porta Communications 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 Media - Diversified company?
The median Gross Margin % among Media - Diversified companies is 38.96, based on 941 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. Porta Communications's current Gross Margin % of 89.40% is 129.5% 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 Porta Communications and its competitors. For the Media - Diversified industry, the median Gross Margin % is 38.96 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Porta Communications's current Gross Margin % is 89.40%, which is near median its own 10-year median of 84.15. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Porta Communications stock overvalued right now?
Porta Communications (LSE:PTCM) has a current Gross Margin % of 89.40%. The current Gross Margin % is 89.40%, which is near median its 10-year median of 84.15 and 129.5% above the Media - Diversified industry median of 38.96. 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 Porta Communications (LSE:PTCM), the current Gross Margin % is 89.40% as of Dec. 2018. 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.
Porta Communications PLC is communications, marketing, design, advertising and analytical service provider. The company engages its business through three segments: Corporate Communications, Marketing and Advertising, and Head Office. Its operating segments include Corporate Communications and Marketing and Advertising through which it offers public relations, public affairs, media buying, advertising, marketing and corporate branding services. Its Head Office segment offers group treasury, and finance and management services. The majority of the company revenues are generated through the Corporate Communications segment mainly from the Europe and Asia-Pacific region.
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