Longchen Paper & Packaging Co (TPE:1909) 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
Longchen Paper & Packaging Co had a gross margin of 12.46% for the quarter that ended in Dec. 2025 => 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.
Longchen Paper & Packaging Co Gross Margin % Related Terms
Longchen Paper & Packaging 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.
Longchen Paper & Packaging Co Gross Margin % Chart
Longchen Paper & Packaging Co Gross Margin % Competitor Comparison
For the Paper & Paper Products subindustry, Longchen Paper & Packaging 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.
Longchen Paper & Packaging Co Gross Margin % vs Forest Products Industry
For the Forest Products industry and Basic Materials sector, Longchen Paper & Packaging Co's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Longchen Paper & Packaging 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.
Longchen Paper & Packaging Co (TPE:1909) has a Gross Margin % of 12.46% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Longchen Paper & Packaging Co and its competitors. This is 10% below median its historical median of 13.79. Over the past decade, Longchen Paper & Packaging Co's Gross Margin % has ranged from 8.28 to 20.57. According to the industry distribution chart, Longchen Paper & Packaging Co ranks #208 out of 279 companies in the Forest Products industry, placing it in the top 74.6%.
Is Longchen Paper & Packaging Co's Gross Margin % too high?
Longchen Paper & Packaging Co's current Gross Margin % of 12.46% is 10% below median its 10-year median of 13.79. Over the past 10 years, this metric has ranged from a low of 8.28 to a high of 20.57. The Forest Products industry median Gross Margin % is 19.05. Longchen Paper & Packaging Co's value of 12.46% is 34.6% below this industry median. Based on the distribution chart, Longchen Paper & Packaging Co ranks #208 out of 279 companies in the Forest Products industry, which is below the industry midpoint. Overall, Longchen Paper & Packaging Co has a GF Score™ of 63/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Longchen Paper & Packaging Co's Gross Margin % compare to competitors?
According to the Forest Products industry distribution chart, Longchen Paper & Packaging Co ranks #208 out of 279 companies for Gross Margin %. This places Longchen Paper & Packaging Co in the lower half of its industry. The industry median Gross Margin % is 19.05. Longchen Paper & Packaging Co's value of 12.46% is 34.6% below this benchmark. Historically, Longchen Paper & Packaging Co's own Gross Margin % has ranged from 8.28 to 20.57 over the past decade. While the company's 10-year median is 13.79 vs. the industry median of 19.05, Longchen Paper & Packaging 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 Forest Products company?
The median Gross Margin % among Forest Products companies is 19.05, based on 279 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. Longchen Paper & Packaging Co's current Gross Margin % of 12.46% is 34.6% 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 Longchen Paper & Packaging Co and its competitors. For the Forest Products industry, the median Gross Margin % is 19.05 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Longchen Paper & Packaging Co's current Gross Margin % is 12.46%, which is 10% below median its own 10-year median of 13.79. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Longchen Paper & Packaging Co stock overvalued right now?
Based on GuruFocus' analysis, Longchen Paper & Packaging Co (TPE:1909) is currently considered Modestly Undervalued. The stock's GF Value™ is NT$12.33, compared to a current price of NT$9.46 — trading 23.3% below its estimated fair value. The current Gross Margin % is 12.46%, which is 10% below median its 10-year median of 13.79 and 34.6% below the Forest Products industry median of 19.05. Longchen Paper & Packaging Co's 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 Longchen Paper & Packaging Co (TPE:1909), the current Gross Margin % is 12.46% as of Dec. 2025. 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 Longchen Paper & Packaging Co (TPE:1909) Overvalued in 2026?
Based on GuruFocus' analysis, Longchen Paper & Packaging Co stock appears to be undervalued.
The current stock price of NT$9.46 is trading 23.3% below its estimated GF Value™ of NT$12.33.
GuruFocus considers Longchen Paper & Packaging Co to be Modestly Undervalued.
Key valuation signals for TPE:1909:
Gross Margin %: 12.46% (10% below median its 10-year median of 13.79)
GF Value™: NT$12.33 vs. price of NT$9.46 (23.3% below fair value)
Industry Position: 34.6% below the Forest Products median (#208 of 279)
No single metric tells the full story. See the TPE:1909 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Longchen Paper & Packaging Co Business Description
Longchen Paper & Packaging Co Ltd is engaged in manufacturing, processing, and trading paper raw materials; manufacturing, printing, processing and trading of corrugated containers; and recycling/renewal of energy and resources, including turnkey design, trial-run and operation of cogeneration and incinerator systems. Its segments include Containerboard: manufacturing and sales of Containerboard; Corrugated container: manufacturing and sale of paper machines; Wastepaper: procurement and sale of wastepaper; and Others: public wastewater treatment and general administration in the Group. It derives majority of the revenue from Containerboard segment.
63GF Score
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