Sunonwealth Electric Machine Industry Co (TPE:2421) 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
Sunonwealth Electric Machine Industry Co had a gross margin of 32.82% for the quarter that ended in Dec. 2025 => 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.
Sunonwealth Electric Machine Industry Co Gross Margin % Related Terms
Sunonwealth Electric Machine Industry 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.
Sunonwealth Electric Machine Industry Co Gross Margin % Chart
Sunonwealth Electric Machine Industry Co Annual Data
TPE:2421 vs GEV, ETN, PH: Gross Margin % Comparison
For the Specialty Industrial Machinery subindustry, Sunonwealth Electric Machine Industry 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.
Sunonwealth Electric Machine Industry Co Gross Margin % vs Industrial Products Industry
* 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.
Sunonwealth Electric Machine Industry Co (TPE:2421) has a Gross Margin % of 32.82% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Sunonwealth Electric Machine Industry Co and its competitors. This is 46% above median its historical median of 22.49. Over the past decade, Sunonwealth Electric Machine Industry Co's Gross Margin % has ranged from 18.70 to 31.06. According to the industry distribution chart, Sunonwealth Electric Machine Industry Co ranks #1159 out of 2991 companies in the Industrial Products industry, placing it in the top 38.7%.
Is Sunonwealth Electric Machine Industry Co's Gross Margin % too high?
Sunonwealth Electric Machine Industry Co's current Gross Margin % of 32.82% is 46% above median its 10-year median of 22.49. Over the past 10 years, this metric has ranged from a low of 18.70 to a high of 31.06. The Industrial Products industry median Gross Margin % is 26.81. Sunonwealth Electric Machine Industry Co's value of 32.82% is 22.4% above this industry median. Based on the distribution chart, Sunonwealth Electric Machine Industry Co ranks #1159 out of 2991 companies in the Industrial Products industry, which is above the industry midpoint. Overall, Sunonwealth Electric Machine Industry Co has a GF Score™ of 97/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Sunonwealth Electric Machine Industry Co's Gross Margin % compare to GEV and ETN?
According to the Industrial Products industry distribution chart, Sunonwealth Electric Machine Industry Co ranks #1159 out of 2991 companies for Gross Margin %. This puts Sunonwealth Electric Machine Industry Co in the upper half of its industry. The industry median Gross Margin % is 26.81. Sunonwealth Electric Machine Industry Co's value of 32.82% is 22.4% above this benchmark. Historically, Sunonwealth Electric Machine Industry Co's own Gross Margin % has ranged from 18.70 to 31.06 over the past decade. While the company's 10-year median is 22.49 vs. the industry median of 26.81, Sunonwealth Electric Machine Industry 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 Industrial Products company?
The median Gross Margin % among Industrial Products companies is 26.81, based on 2,991 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. Sunonwealth Electric Machine Industry Co's current Gross Margin % of 32.82% is 22.4% 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 Sunonwealth Electric Machine Industry Co and its competitors. For the Industrial Products industry, the median Gross Margin % is 26.81 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Sunonwealth Electric Machine Industry Co's current Gross Margin % is 32.82%, which is 46% above median its own 10-year median of 22.49. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sunonwealth Electric Machine Industry Co stock overvalued right now?
Based on GuruFocus' analysis, Sunonwealth Electric Machine Industry Co (TPE:2421) is currently considered Fairly Valued. The stock's GF Value™ is NT$148.34, compared to a current price of NT$149.00 — trading 0.4% above its estimated fair value. The current Gross Margin % is 32.82%, which is 46% above median its 10-year median of 22.49 and 22.4% above the Industrial Products industry median of 26.81. Sunonwealth Electric Machine Industry Co's overall GF Score™ is 97/100 with 2 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 Sunonwealth Electric Machine Industry Co (TPE:2421), the current Gross Margin % is 32.82% 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 Sunonwealth Electric Machine Industry Co (TPE:2421) Overvalued in 2026?
Based on GuruFocus' analysis, Sunonwealth Electric Machine Industry Co stock appears to be overvalued.
The current stock price of NT$149.00 is trading 0.4% above its estimated GF Value™ of NT$148.34.
GuruFocus considers Sunonwealth Electric Machine Industry Co to be Fairly Valued.
Key valuation signals for TPE:2421:
Gross Margin %: 32.82% (46% above median its 10-year median of 22.49)
GF Value™: NT$148.34 vs. price of NT$149.00 (0.4% above fair value)
Industry Position: 22.4% above the Industrial Products median (#1159 of 2991)
No single metric tells the full story. See the TPE:2421 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sunonwealth Electric Machine Industry Co Business Description
Sunonwealth Electric Machine Industry Co Ltd is a Taiwan-based company that engages in the production and sale of precision motors, AC/DC brushless fans, electric fans, and micro cooling fans. Its products include DC fan and blower series; AC fans, EC fans, fan trays, fan accessories, ventilation fans, and others. It serves its products in various industries, such as IT, automobile electronics, optical electronics, and network communication industries.
97GF Score
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