Gross Margin % is calculated as gross profit divided by its revenue. Quest Diagnostics's Gross Profit for the
three
months ended in Dec. 2023 was $736 Mil. Quest Diagnostics's Revenue for the
three
months ended in Dec. 2023 was $2,288 Mil. Therefore, Quest Diagnostics's Gross Margin % for the quarter that ended in Dec. 2023 was 32.17%.
The historical rank and industry rank for Quest Diagnostics's Gross Margin % or its related term are showing as below:
DGX'
s Gross Margin % Range Over the Past 10 Years
Min: 33 Med: 36.13 Max: 39.02
Current: 33
During the past 13 years, the highestGross Margin % of Quest Diagnostics was 39.02%. The lowest was 33.00%. And the median was 36.13%.
DGX's Gross Margin % is ranked worse than 71.3% of 216
companies
in the Medical Diagnostics & Research industry
Industry Median: 45.595
vs DGX: 33.00
Quest Diagnostics had a gross margin of 32.17% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Quest Diagnostics was -0.70% per year.
Quest Diagnostics Gross Margin % Historical Data
The historical data trend for Quest Diagnostics'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.
Competitive Comparison of Quest Diagnostics's Gross Margin %
For the Diagnostics & Research subindustry, Quest Diagnostics'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.
Quest Diagnostics's Gross Margin % Distribution in the Medical Diagnostics & Research Industry
For the Medical Diagnostics & Research industry and Healthcare sector, Quest Diagnostics's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Quest Diagnostics'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.
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
Quest Diagnostics had a gross margin of 32.17% for the quarter that ended in Dec. 2023 => 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.
Quest Diagnostics Gross Margin % Related Terms
Thank you for viewing the detailed overview of Quest Diagnostics's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Quest Diagnostics (Quest Diagnostics) Business Description
Quest Diagnostics is a leading independent provider of diagnostic testing, information, and services in the U.S. The company generates over 95% of its revenue through clinical testing, anatomic pathology, esoteric testing, and substance abuse testing with specimens collected at its national network of roughly 2,300 patient service centers, as well as multiple doctors offices and hospitals. The firm also runs a much smaller diagnostic solutions segment that provides clinical trials testing, risk assessment services, and information technology solutions.
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