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
Webco Industries had a gross margin of 13.01% for the quarter that ended in Jul. 2023 => 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.
Webco Industries Gross Margin % Related Terms
Webco Industries Gross Margin % Historical Data
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The historical data trend for Webco Industries'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 Steel subindustry, Webco Industries'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.
Webco Industries Gross Margin % vs Steel Industry
For the Steel industry and Basic Materials sector, Webco Industries's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Webco Industries'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.
Webco Industries (WEBC) has a Gross Margin % of 13.01% as of Jul. 2023. Gross margin is the ratio of total gross profit to net sales. View historical data on Webco Industries and its competitors.
Is Webco Industries' Gross Margin % too high?
Webco Industries' current Gross Margin % is 13.01%. The Steel industry median Gross Margin % is 12.61. Webco Industries' value of 13.01% is 3.2% above this industry median. Overall, Webco Industries has a GF Score™ of 12/100, reflecting its overall financial health beyond just this single metric.
How does Webco Industries' Gross Margin % compare to ACNT and FRD?
Webco Industries' Gross Margin % of 13.01% can be compared against companies in the Steel industry. The industry median Gross Margin % is 12.61. Webco Industries' value of 13.01% is 3.2% above this benchmark. 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 Steel company?
The median Gross Margin % among Steel companies is 12.61, based on 594 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. Webco Industries's current Gross Margin % of 13.01% is 3.2% 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 Webco Industries and its competitors. For the Steel industry, the median Gross Margin % is 12.61 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Webco Industries's current Gross Margin % is 13.01%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Webco Industries stock overvalued right now?
Webco Industries (WEBC) has a current Gross Margin % of 13.01%. The current Gross Margin % is 13.01% and 3.2% above the Steel industry median of 12.61. Webco Industries' overall GF Score™ is 12/100. 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 Webco Industries (WEBC), the current Gross Margin % is 13.01% as of Jul. 2023. 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.
Webco Industries Inc is a specialty manufacturer and seller of high-quality carbon and stainless steel tubing products that are designed to industry and customer specifications. The company's products includes Welded tubing; Cold drawn- Welded and Cold drawn- Seamless. Its value-added services include bending, custom mill length, end formed/swaged, finning, heat treating, packaging, precision cutting, product availability and responsiveness.
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