SoftcatLSE:SCT +1.97%88 Gross Margin % is 32.22% as of Jan. 2026, which is 23% above its 10-year median of 26.16. GuruFocus rates LSE:SCT with a GF Score™ of 88/100 and a GF Value™ of £26.05 (Significantly Undervalued). The stock has 4 warning signs investors should review. Among 2,454 Hardware companies, Softcat ranks better than 62.06% on this metric.
Gross Margin % is calculated as gross profit divided by its revenue. Softcat's Gross Profit for the
six
months ended in Jan. 2026 was £270 Mil. Softcat's Revenue for the
six
months ended in Jan. 2026 was £838 Mil. Therefore, Softcat's Gross Margin % for the quarter that ended in Jan. 2026 was 32.22%.
The historical rank and industry rank for Softcat's Gross Margin % or its related term are showing as below:
LSE:SCT'
s Gross Margin % Range Over the Past 10 Years
Min: 16.37 Med: 26.16 Max: 43.4
Current: 31.08
During the past 13 years, the highestGross Margin % of Softcat was 43.40%. The lowest was 16.37%. And the median was 26.16%.
LSE:SCT's Gross Margin % is ranked better than 62.06% of 2454
companies
in the Hardware industry
Industry Median: 24.565
vs LSE:SCT: 31.08
Softcat had a gross margin of 32.22% for the quarter that ended in Jan. 2026 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Softcat was 9.10% per year.
Softcat (LSE:SCT) 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
Softcat had a gross margin of 32.22% for the quarter that ended in Jan. 2026 => 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.
Softcat Gross Margin % Related Terms
Softcat Gross Margin % Historical Data
* Premium members only.
The historical data trend for Softcat'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:SCT vs SNX, ARW, AVT: Gross Margin % Comparison
For the Electronics & Computer Distribution subindustry, Softcat'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.
Softcat Gross Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Softcat's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Softcat'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.
Softcat (LSE:SCT) has a Gross Margin % of 32.22% as of Jan. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Softcat and its competitors. This is 23% above median its historical median of 26.16. Over the past decade, Softcat's Gross Margin % has ranged from 16.37 to 43.40. According to the industry distribution chart, Softcat ranks #931 out of 2454 companies in the Hardware industry, placing it in the top 37.9%.
Is Softcat's Gross Margin % too high?
Softcat's current Gross Margin % of 32.22% is 23% above median its 10-year median of 26.16. Over the past 10 years, this metric has ranged from a low of 16.37 to a high of 43.40. The Hardware industry median Gross Margin % is 24.57. Softcat's value of 32.22% is 31.2% above this industry median. Based on the distribution chart, Softcat ranks #931 out of 2454 companies in the Hardware industry, which is above the industry midpoint. Overall, Softcat has a GF Score™ of 88/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Softcat's Gross Margin % compare to SNX and ARW?
According to the Hardware industry distribution chart, Softcat ranks #931 out of 2454 companies for Gross Margin %. This puts Softcat in the upper half of its industry. The industry median Gross Margin % is 24.57. Softcat's value of 32.22% is 31.2% above this benchmark. Historically, Softcat's own Gross Margin % has ranged from 16.37 to 43.40 over the past decade. While the company's 10-year median is 26.16 vs. the industry median of 24.57, Softcat 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 Hardware company?
The median Gross Margin % among Hardware companies is 24.57, 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. Softcat's current Gross Margin % of 32.22% is 31.2% 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 Softcat and its competitors. For the Hardware industry, the median Gross Margin % is 24.57 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Softcat's current Gross Margin % is 32.22%, which is 23% above median its own 10-year median of 26.16. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Softcat stock overvalued right now?
Based on GuruFocus' analysis, Softcat (LSE:SCT) is currently considered Significantly Undervalued. The stock's GF Value™ is £26.05, compared to a current price of £18.13 — trading 30.4% below its estimated fair value. The current Gross Margin % is 32.22%, which is 23% above median its 10-year median of 26.16 and 31.2% above the Hardware industry median of 24.57. Softcat's overall GF Score™ is 88/100 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 Softcat (LSE:SCT), the current Gross Margin % is 32.22% as of Jan. 2026. 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 Softcat (LSE:SCT) Overvalued in 2026?
Based on GuruFocus' analysis, Softcat stock appears to be undervalued.
The current stock price of £18.13 is trading 30.4% below its estimated GF Value™ of £26.05.
GuruFocus considers Softcat to be Significantly Undervalued.
Key valuation signals for LSE:SCT:
Gross Margin %: 32.22% (23% above median its 10-year median of 26.16)
GF Value™: £26.05 vs. price of £18.13 (30.4% below fair value)
Industry Position: 31.2% above the Hardware median (#931 of 2454)
No single metric tells the full story. See the LSE:SCT stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Softcat PLC is an information technology infrastructure and service provider offering software licensing, workplace technology, networking and security, and cloud and data center solutions to corporates, public sector organizations, and small to medium-sized businesses, with the latter being the main business provider. It earns revenue from software, hardware, and services, including its own services, with the majority derived from software products. Its solutions include Workspace, Cyber Security, Networking and Connectivity, Data, Automation and AI, and Hybrid Cloud Solutions. The company serves Small to Medium Businesses, Enterprise, Multinational Services, and the Public Sector including healthcare, education, government, defence, police, and emergency services.
88GF Score
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