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SM Energy CoSM -0.28%73 Gross Margin % is 41.77% as of Mar. 2026, which is 32% above its 10-year median of 31.53. GuruFocus rates SM with a GF Score™ of 73/100 and a GF Value™ of $52.26 (Possible Value Trap). The stock has 10 warning signs investors should review. Among 870 Oil & Gas companies, SM Energy Co ranks better than 63.33% on this metric.
The historical rank and industry rank for SM Energy Co's Gross Margin % or its related term are showing as below:
SM'
s Gross Margin % Range Over the Past 10 Years
Min: -17.62 Med: 31.53 Max: 63.4
Current: 34.92
During the past 13 years, the highestGross Margin % of SM Energy Co was 63.40%. The lowest was -17.62%. And the median was 31.53%.
SM's Gross Margin % is ranked better than 63.33% of 870
companies
in the Oil & Gas industry
Industry Median: 25.955
vs SM: 34.92
SM Energy Co had a gross margin of 41.77% for the quarter that ended in Mar. 2026 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for SM Energy Co was 0.00% per year.
SM Energy Co (NYSE:SM) 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
SM Energy Co had a gross margin of 41.77% for the quarter that ended in Mar. 2026 => 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.
SM Energy Co Gross Margin % Related Terms
SM Energy Co Gross Margin % Historical Data
* Premium members only.
The historical data trend for SM Energy Co'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 Oil & Gas E&P subindustry, SM Energy 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.
SM Energy Co Gross Margin % vs Oil & Gas Industry
For the Oil & Gas industry and Energy sector, SM Energy Co's Gross Margin % distribution charts can be found below:
* The bar in red indicates where SM Energy 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.
SM Energy Co (SM) has a Gross Margin % of 41.77% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on SM Energy Co and its competitors. This is 32% above median its historical median of 31.53. According to the industry distribution chart, SM Energy Co ranks #319 out of 870 companies in the Oil & Gas industry, placing it in the top 36.7%.
Is SM Energy Co's Gross Margin % too high?
SM Energy Co's current Gross Margin % of 41.77% is 32% above median its 10-year median of 31.53. The Oil & Gas industry median Gross Margin % is 25.96. SM Energy Co's value of 41.77% is 60.9% above this industry median. Based on the distribution chart, SM Energy Co ranks #319 out of 870 companies in the Oil & Gas industry, which is above the industry midpoint. Overall, SM Energy Co has a GF Score™ of 73/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does SM Energy Co's Gross Margin % compare to CHRD and RRC?
According to the Oil & Gas industry distribution chart, SM Energy Co ranks #319 out of 870 companies for Gross Margin %. This puts SM Energy Co in the upper half of its industry. The industry median Gross Margin % is 25.96. SM Energy Co's value of 41.77% is 60.9% above this benchmark. While the company's 10-year median is 31.53 vs. the industry median of 25.96, SM Energy Co 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 an Oil & Gas company?
The median Gross Margin % among Oil & Gas companies is 25.96, based on 870 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. SM Energy Co's current Gross Margin % of 41.77% is 60.9% 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 SM Energy Co and its competitors. For the Oil & Gas industry, the median Gross Margin % is 25.96 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. SM Energy Co's current Gross Margin % is 41.77%, which is 32% above median its own 10-year median of 31.53. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is SM Energy Co stock overvalued right now?
Based on GuruFocus' analysis, SM Energy Co (SM) is currently considered Possible Value Trap. The stock's GF Value™ is $52.26, compared to a current price of $31.63 — trading 39.5% below its estimated fair value. The current Gross Margin % is 41.77%, which is 32% above median its 10-year median of 31.53 and 60.9% above the Oil & Gas industry median of 25.96. SM Energy Co's overall GF Score™ is 73/100 with 10 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 SM Energy Co (SM), the current Gross Margin % is 41.77% 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 SM Energy Co (SM) Overvalued in 2026?
Based on GuruFocus' analysis, SM Energy Co stock appears to be undervalued.
The current stock price of $31.63 is trading 39.5% below its estimated GF Value™ of $52.26.
GuruFocus considers SM Energy Co to be Possible Value Trap.
Key valuation signals for SM:
Gross Margin %: 41.77% (32% above median its 10-year median of 31.53)
GF Value™: $52.26 vs. price of $31.63 (39.5% below fair value)
Industry Position: 60.9% above the Oil & Gas median (#319 of 870)
No single metric tells the full story. See the SM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
SM Energy Co is an independent energy company engaged in the acquisition, exploration, development, and production of oil, gas, and NGLs in Texas and Utah. The Company operates in the oil and gas extraction industry, focused on exploration and production activities, onshore in the United States. Its portfolio is comprised of assets in the Midland Basin of West Texas, the Maverick Basin of South Texas, and the Uinta Basin of northeastern Utah.
73GF Score
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