Eastern Communications Co (SHSE:600776) 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
Eastern Communications Co had a gross margin of 11.55% for the quarter that ended in Mar. 2026 => 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.
Eastern Communications Co Gross Margin % Related Terms
Eastern Communications 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.
SHSE:600776 vs CSCO, CIEN, MSI: Gross Margin % Comparison
For the Communication Equipment subindustry, Eastern Communications 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.
Eastern Communications Co Gross Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Eastern Communications Co's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Eastern Communications Co'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.
Eastern Communications Co (SHSE:600776) has a Gross Margin % of 11.55% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Eastern Communications Co and its competitors. This is near median its historical median of 12.08. Over the past decade, Eastern Communications Co's Gross Margin % has ranged from 8.99 to 20.42. According to the industry distribution chart, Eastern Communications Co ranks #2123 out of 2453 companies in the Hardware industry, placing it in the top 86.5%.
Is Eastern Communications Co's Gross Margin % too high?
Eastern Communications Co's current Gross Margin % of 11.55% is near median its 10-year median of 12.08. Over the past 10 years, this metric has ranged from a low of 8.99 to a high of 20.42. The Hardware industry median Gross Margin % is 24.52. Eastern Communications Co's value of 11.55% is 52.9% below this industry median. Based on the distribution chart, Eastern Communications Co ranks #2123 out of 2453 companies in the Hardware industry, which is in the bottom quartile relative to peers. Overall, Eastern Communications Co has a GF Score™ of 64/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Eastern Communications Co's Gross Margin % compare to CSCO and CIEN?
According to the Hardware industry distribution chart, Eastern Communications Co ranks #2123 out of 2453 companies for Gross Margin %. This places Eastern Communications Co in the lower half of its industry. The industry median Gross Margin % is 24.52. Eastern Communications Co's value of 11.55% is 52.9% below this benchmark. Historically, Eastern Communications Co's own Gross Margin % has ranged from 8.99 to 20.42 over the past decade. While the company's 10-year median is 12.08 vs. the industry median of 24.52, Eastern Communications Co has consistently been below 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 24.52, based on 2,453 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. Eastern Communications Co's current Gross Margin % of 11.55% is 52.9% below 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 Eastern Communications Co and its competitors. For the Hardware industry, the median Gross Margin % is 24.52 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Eastern Communications Co's current Gross Margin % is 11.55%, which is near median its own 10-year median of 12.08. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Eastern Communications Co stock overvalued right now?
Based on GuruFocus' analysis, Eastern Communications Co (SHSE:600776) is currently considered Modestly Overvalued. The stock's GF Value™ is ¥11.35, compared to a current price of ¥12.98 — trading 14.4% above its estimated fair value. The current Gross Margin % is 11.55%, which is near median its 10-year median of 12.08 and 52.9% below the Hardware industry median of 24.52. Eastern Communications Co's overall GF Score™ is 64/100 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 Eastern Communications Co (SHSE:600776), the current Gross Margin % is 11.55% as of Mar. 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 Eastern Communications Co (SHSE:600776) Overvalued in 2026?
Based on GuruFocus' analysis, Eastern Communications Co stock appears to be overvalued.
The current stock price of ¥12.98 is trading 14.4% above its estimated GF Value™ of ¥11.35.
GuruFocus considers Eastern Communications Co to be Modestly Overvalued.
Key valuation signals for SHSE:600776:
Gross Margin %: 11.55% (near median its 10-year median of 12.08)
GF Value™: ¥11.35 vs. price of ¥12.98 (14.4% above fair value)
Industry Position: 52.9% below the Hardware median (#2123 of 2453)
No single metric tells the full story. See the SHSE:600776 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Eastern Communications Co Ltd is a China-based communications services company. It provides solutions for industrial applications and listed companies in the fields of communication and financial technology, communications business, an intelligent manufacturing business and intelligent services and software and other fields. The company's product portfolio includes private network communications and information security products and solutions; financial electronic equipment and operations services; communications and information technology integration services and EMS manufacturing operations. The company's products and solutions are used in China and other international countries.
64GF Score
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