Surge ComponentsSPRS 63 Gross Margin % is 29.39% as of Feb. 2026, which is 7% above its 10-year median of 27.48. GuruFocus rates SPRS with a GF Score™ of 63/100 and a GF Value™ of $2.62 (Significantly Overvalued). The stock has 6 warning signs investors should review. Among 2,449 Hardware companies, Surge Components ranks better than 57.94% on this metric.
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
Surge Components had a gross margin of 29.39% for the quarter that ended in Feb. 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.
Surge Components Gross Margin % Related Terms
Surge Components Gross Margin % Historical Data
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The historical data trend for Surge Components'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 Electronics & Computer Distribution subindustry, Surge Components'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.
Surge Components Gross Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Surge Components's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Surge Components'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.
Surge Components (SPRS) has a Gross Margin % of 29.39% as of Feb. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Surge Components and its competitors. This is near median its historical median of 27.48. Over the past decade, Surge Components' Gross Margin % has ranged from 25.22 to 29.01. According to the industry distribution chart, Surge Components ranks #1030 out of 2449 companies in the Hardware industry, placing it in the top 42.1%.
Is Surge Components' Gross Margin % too high?
Surge Components' current Gross Margin % of 29.39% is near median its 10-year median of 27.48. Over the past 10 years, this metric has ranged from a low of 25.22 to a high of 29.01. The Hardware industry median Gross Margin % is 24.52. Surge Components' value of 29.39% is 19.9% above this industry median. Based on the distribution chart, Surge Components ranks #1030 out of 2449 companies in the Hardware industry, which is above the industry midpoint. Overall, Surge Components has a GF Score™ of 63/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Surge Components' Gross Margin % compare to TAIT and IZM?
According to the Hardware industry distribution chart, Surge Components ranks #1030 out of 2449 companies for Gross Margin %. This puts Surge Components in the upper half of its industry. The industry median Gross Margin % is 24.52. Surge Components' value of 29.39% is 19.9% above this benchmark. Historically, Surge Components' own Gross Margin % has ranged from 25.22 to 29.01 over the past decade. While the company's 10-year median is 27.48 vs. the industry median of 24.52, Surge Components 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 24.52, based on 2,449 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. Surge Components's current Gross Margin % of 29.39% is 19.9% 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 Surge Components 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. Surge Components's current Gross Margin % is 29.39%, which is near median its own 10-year median of 27.48. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Surge Components stock overvalued right now?
Based on GuruFocus' analysis, Surge Components (SPRS) is currently considered Significantly Overvalued. The stock's GF Value™ is $2.62, compared to a current price of $3.60 — trading 37.4% above its estimated fair value. The current Gross Margin % is 29.39%, which is near median its 10-year median of 27.48 and 19.9% above the Hardware industry median of 24.52. Surge Components' overall GF Score™ is 63/100 with 6 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 Surge Components (SPRS), the current Gross Margin % is 29.39% as of Feb. 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 Surge Components (SPRS) Overvalued in 2026?
Based on GuruFocus' analysis, Surge Components stock appears to be overvalued.
The current stock price of $3.60 is trading 37.4% above its estimated GF Value™ of $2.62.
GuruFocus considers Surge Components to be Significantly Overvalued.
Key valuation signals for SPRS:
Gross Margin %: 29.39% (near median its 10-year median of 27.48)
GF Value™: $2.62 vs. price of $3.60 (37.4% above fair value)
Industry Position: 19.9% above the Hardware median (#1030 of 2449)
No single metric tells the full story. See the SPRS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Surge Components Inc is a supplier of electronic products and components. The company's products include capacitors, which are electrical energy storage devices, and discrete components, such as rectifiers, switches, transistors, voltage suppressors, and diodes. Its marketed products are utilized in the electronic circuitry of products, comprising of automobiles, telecom, audio, cellular telephones, computers, consumer electronics, garage door openers, household appliances, power supplies, and security equipment. In addition, the company's products are also sold to original equipment manufacturers and distributors.
63GF Score
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