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
Dell-VMWare Tracking Stock had a gross margin of 85.68% for the quarter that ended in Oct. 2018 => 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.
Dell-VMWare Tracking Stock Gross Margin % Related Terms
Dell-VMWare Tracking Stock 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.
XTER:12D vs CA, CTXS, PAGS: Gross Margin % Comparison
For the Software - Infrastructure subindustry, Dell-VMWare Tracking Stock'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.
Dell-VMWare Tracking Stock Gross Margin % vs Software Industry
For the Software industry and Technology sector, Dell-VMWare Tracking Stock's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Dell-VMWare Tracking Stock'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.
Dell-VMWare Tracking Stock (XTER:12D) has a Gross Margin % of 85.68% as of Oct. 2018. Gross margin is the ratio of total gross profit to net sales. View historical data on Dell-VMWare Tracking Stock and its competitors. This is near median its historical median of 85.60. Over the past decade, Dell-VMWare Tracking Stock's Gross Margin % has ranged from 85.60 to 85.93.
Is Dell-VMWare Tracking Stock's Gross Margin % too high?
Dell-VMWare Tracking Stock's current Gross Margin % of 85.68% is near median its 10-year median of 85.60. Over the past 10 years, this metric has ranged from a low of 85.60 to a high of 85.93. The Software industry median Gross Margin % is 40.45. Dell-VMWare Tracking Stock's value of 85.68% is 111.8% above this industry median.
How does Dell-VMWare Tracking Stock's Gross Margin % compare to CA and CTXS?
Dell-VMWare Tracking Stock's Gross Margin % of 85.68% can be compared against companies in the Software industry. The industry median Gross Margin % is 40.45. Dell-VMWare Tracking Stock's value of 85.68% is 111.8% above this benchmark. Historically, Dell-VMWare Tracking Stock's own Gross Margin % has ranged from 85.60 to 85.93 over the past decade. While the company's 10-year median is 85.60 vs. the industry median of 40.45, Dell-VMWare Tracking Stock 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 Software company?
The median Gross Margin % among Software companies is 40.45, based on 2,680 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. Dell-VMWare Tracking Stock's current Gross Margin % of 85.68% is 111.8% 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 Dell-VMWare Tracking Stock and its competitors. For the Software industry, the median Gross Margin % is 40.45 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Dell-VMWare Tracking Stock's current Gross Margin % is 85.68%, which is near median its own 10-year median of 85.60. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Dell-VMWare Tracking Stock stock overvalued right now?
Dell-VMWare Tracking Stock (XTER:12D) has a current Gross Margin % of 85.68%. The current Gross Margin % is 85.68%, which is near median its 10-year median of 85.60 and 111.8% above the Software industry median of 40.45. 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 Dell-VMWare Tracking Stock (XTER:12D), the current Gross Margin % is 85.68% as of Oct. 2018. 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.
Dell-VMWare Tracking Stock was incorporated in the state of Delaware on January 31, 2013 under the name of Denali Holding Inc. It changed its name to Dell Technologies Inc. on August 25, 2016. On September 7, 2016, a merger subsidiary of Dell Technologies merged with and into EMC Corporation, with EMC Corporation surviving the merger as a wholly-owned subsidiary of Dell Technologies. The company has issued a tracking stock to track the performance of a portion of Dell Technologies' economic interest in the VMware business. It is an information technology company. The company offers virtualization and cloud infrastructure solutions, which enable organizations to manage IT resources across complex multi-cloud, multi-device environments.
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