TorotrakLSE:TRK Gross Margin % is 77.54% as of Mar. 2017, which is 7% below its 10-year median of 83.14. The stock has 4 warning signs investors should review.
Gross Margin % is calculated as gross profit divided by its revenue. Torotrak's Gross Profit for the
six
months ended in Mar. 2017 was £0.40 Mil. Torotrak's Revenue for the
six
months ended in Mar. 2017 was £0.52 Mil. Therefore, Torotrak's Gross Margin % for the quarter that ended in Mar. 2017 was 77.54%.
Warning Sign:
Torotrak PLC gross margin has been in long term decline. The average rate of decline per year is -24%.
The historical rank and industry rank for Torotrak's Gross Margin % or its related term are showing as below:
LSE:TRK'
s Gross Margin % Range Over the Past 10 Years
Min: 7.96 Med: 83.14 Max: 100
Current: 55.59
During the past 13 years, the highestGross Margin % of Torotrak was 100.00%. The lowest was 7.96%. And the median was 83.14%.
LSE:TRK's Gross Margin % is not ranked
in the Vehicles & Parts industry.
Industry Median: 19.835
vs LSE:TRK: 55.59
Torotrak had a gross margin of 77.54% for the quarter that ended in Mar. 2017 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Torotrak was -24.00% per year.
Torotrak (LSE:TRK) 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
Torotrak had a gross margin of 77.54% for the quarter that ended in Mar. 2017 => 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.
Torotrak Gross Margin % Related Terms
Torotrak Gross Margin % Historical Data
* Premium members only.
The historical data trend for Torotrak'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 Auto Parts subindustry, Torotrak'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.
Torotrak Gross Margin % vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Torotrak's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Torotrak'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.
Torotrak (LSE:TRK) has a Gross Margin % of 77.54% as of Mar. 2017. Gross margin is the ratio of total gross profit to net sales. View historical data on Torotrak and its competitors. This is near median its historical median of 83.14. Over the past decade, Torotrak's Gross Margin % has ranged from 7.96 to 100.00.
Is Torotrak's Gross Margin % too high?
Torotrak's current Gross Margin % of 77.54% is near median its 10-year median of 83.14. Over the past 10 years, this metric has ranged from a low of 7.96 to a high of 100.00. The Vehicles & Parts industry median Gross Margin % is 19.84. Torotrak's value of 77.54% is 290.9% above this industry median.
How does Torotrak's Gross Margin % compare to DLPH?
Torotrak's Gross Margin % of 77.54% can be compared against companies in the Vehicles & Parts industry. The industry median Gross Margin % is 19.84. Torotrak's value of 77.54% is 290.9% above this benchmark. Historically, Torotrak's own Gross Margin % has ranged from 7.96 to 100.00 over the past decade. While the company's 10-year median is 83.14 vs. the industry median of 19.84, Torotrak 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 Vehicles & Parts company?
The median Gross Margin % among Vehicles & Parts companies is 19.84, based on 1,310 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. Torotrak's current Gross Margin % of 77.54% is 290.9% 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 Torotrak and its competitors. For the Vehicles & Parts industry, the median Gross Margin % is 19.84 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Torotrak's current Gross Margin % is 77.54%, which is near median its own 10-year median of 83.14. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Torotrak stock overvalued right now?
Torotrak (LSE:TRK) has a current Gross Margin % of 77.54%. The current Gross Margin % is 77.54%, which is near median its 10-year median of 83.14 and 290.9% above the Vehicles & Parts industry median of 19.84. 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 Torotrak (LSE:TRK), the current Gross Margin % is 77.54% as of Mar. 2017. 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.
Torotrak PLC is a technology development company. It designs, develops and offers technologies that are focused on products, such as infinitely variable transmissions (IVTs), variable drive superchargers (V-Charge) and mechanical kinetic energy recovery systems (Flybrid). The company operates its business through the following segments, Licence Agreements, Engineering Services, and Development Activities, Including Research and The Creation of New Intellectual Property. Its Flybrid technology relates to high-speed flywheels which are used vehicles, V-Charge technology is used to control emissions in gasoline and diesel engines, and IVTs improves the performance and fuel economy of the vehicle.
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