CETC Digital Technology Co (SHSE:600850) 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
CETC Digital Technology Co had a gross margin of 17.30% 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.
CETC Digital Technology Co Gross Margin % Related Terms
CETC Digital Technology 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:600850 vs MSFT, ORCL, PLTR: Gross Margin % Comparison
For the Software - Infrastructure subindustry, CETC Digital Technology 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.
CETC Digital Technology Co Gross Margin % vs Software Industry
For the Software industry and Technology sector, CETC Digital Technology Co's Gross Margin % distribution charts can be found below:
* The bar in red indicates where CETC Digital Technology 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.
CETC Digital Technology Co (SHSE:600850) has a Gross Margin % of 17.30% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on CETC Digital Technology Co and its competitors. This is near median its historical median of 17.51. Over the past decade, CETC Digital Technology Co's Gross Margin % has ranged from 14.95 to 20.32. According to the industry distribution chart, CETC Digital Technology Co ranks #2222 out of 2678 companies in the Software industry, placing it in the top 83%.
Is CETC Digital Technology Co's Gross Margin % too high?
CETC Digital Technology Co's current Gross Margin % of 17.30% is near median its 10-year median of 17.51. Over the past 10 years, this metric has ranged from a low of 14.95 to a high of 20.32. The Software industry median Gross Margin % is 40.46. CETC Digital Technology Co's value of 17.30% is 57.2% below this industry median. Based on the distribution chart, CETC Digital Technology Co ranks #2222 out of 2678 companies in the Software industry, which is in the bottom quartile relative to peers. Overall, CETC Digital Technology Co has a GF Score™ of 64/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does CETC Digital Technology Co's Gross Margin % compare to MSFT and ORCL?
According to the Software industry distribution chart, CETC Digital Technology Co ranks #2222 out of 2678 companies for Gross Margin %. This places CETC Digital Technology Co in the lower half of its industry. The industry median Gross Margin % is 40.46. CETC Digital Technology Co's value of 17.30% is 57.2% below this benchmark. Historically, CETC Digital Technology Co's own Gross Margin % has ranged from 14.95 to 20.32 over the past decade. While the company's 10-year median is 17.51 vs. the industry median of 40.46, CETC Digital Technology 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 Software company?
The median Gross Margin % among Software companies is 40.46, based on 2,678 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. CETC Digital Technology Co's current Gross Margin % of 17.30% is 57.2% 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 CETC Digital Technology Co and its competitors. For the Software industry, the median Gross Margin % is 40.46 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. CETC Digital Technology Co's current Gross Margin % is 17.30%, which is near median its own 10-year median of 17.51. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is CETC Digital Technology Co stock overvalued right now?
Based on GuruFocus' analysis, CETC Digital Technology Co (SHSE:600850) is currently considered Modestly Undervalued. The stock's GF Value™ is ¥20.27, compared to a current price of ¥14.96 — trading 26.2% below its estimated fair value. The current Gross Margin % is 17.30%, which is near median its 10-year median of 17.51 and 57.2% below the Software industry median of 40.46. CETC Digital Technology Co's overall GF Score™ is 64/100 with 5 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 CETC Digital Technology Co (SHSE:600850), the current Gross Margin % is 17.30% 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 CETC Digital Technology Co (SHSE:600850) Overvalued in 2026?
Based on GuruFocus' analysis, CETC Digital Technology Co stock appears to be undervalued.
The current stock price of ¥14.96 is trading 26.2% below its estimated GF Value™ of ¥20.27.
GuruFocus considers CETC Digital Technology Co to be Modestly Undervalued.
Key valuation signals for SHSE:600850:
Gross Margin %: 17.30% (near median its 10-year median of 17.51)
GF Value™: ¥20.27 vs. price of ¥14.96 (26.2% below fair value)
Industry Position: 57.2% below the Software median (#2222 of 2678)
No single metric tells the full story. See the SHSE:600850 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
CETC Digital Technology Co Ltd is engaged in the development of information systems and software engineering in China. It is also involved in the design, installation, and construction of computer hardware, communication equipment, electronics, integrated system equipment systems integration, network engineering, software engineering and electronic engineering. Its product and services include Data Center Product Solution, Cloud product solutions, and Cloud service management. The company distributes its products within domestic and overseas markets.
64GF Score
Get the complete analysis for SHSE:600850
Gross Margin % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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