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Constellation Brands Inc  (NYSE:STZ) Gross Margin %: 51.11% (As of Aug. 2017)

Gross Margin % is calculated as gross profit divided by its revenue. Constellation Brands Inc's Gross Profit for the three months ended in Aug. 2017 was $1,065 Mil. Constellation Brands Inc's Revenue for the three months ended in Aug. 2017 was $2,085 Mil. Therefore, Constellation Brands Inc's Gross Margin % for the quarter that ended in Aug. 2017 was 51.11%.


NYSE:STZ' s Gross Margin % Range Over the Past 10 Years
Min: 33.66   Max: 48.14
Current: 50.14

33.66
48.14

During the past 13 years, the highest Gross Margin % of Constellation Brands Inc was 48.14%. The lowest was 33.66%. And the median was 39.83%.

NYSE:STZ's Gross Margin % is ranked higher than
64% of the 206 Companies
in the Global industry.

( Industry Median: 42.22 vs. NYSE:STZ: 50.14 )

Constellation Brands Inc had a gross margin of 51.11% for the quarter that ended in Aug. 2017 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Constellation Brands Inc was 3.90% per year.


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Constellation Brands Inc Annual Data

Feb08 Feb09 Feb10 Feb11 Feb12 Feb13 Feb14 Feb15 Feb16 Feb17
Gross Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 39.64 40.92 42.78 44.93 48.14

Constellation Brands Inc Quarterly Data

Nov12 Feb13 May13 Aug13 Nov13 Feb14 May14 Aug14 Nov14 Feb15 May15 Aug15 Nov15 Feb16 May16 Aug16 Nov16 Feb17 May17 Aug17
Gross Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 47.94 49.24 48.38 51.42 51.11

Competitive Comparison
* 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.


Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

Constellation Brands Inc's Gross Margin for the fiscal year that ended in Feb. 2017 is calculated as

Gross Margin % (A: Feb. 2017 )=Gross Profit (A: Feb. 2017 ) / Revenue (A: Feb. 2017 )
=3529.4 / 7331.5
=(Revenue - Cost of Goods Sold) / Revenue
=(7331.5 - 3802.1) / 7331.5
=48.14 %

Constellation Brands Inc's Gross Margin for the quarter that ended in Aug. 2017 is calculated as


Gross Margin % (Q: Aug. 2017 )=Gross Profit (Q: Aug. 2017 ) / Revenue (Q: Aug. 2017 )
=-1019.2 / 2084.5
=(Revenue - Cost of Goods Sold) / Revenue
=(2084.5 - 1019.2) / 2084.5
=51.11 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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.


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

Constellation Brands Inc had a gross margin of 51.11% for the quarter that ended in Aug. 2017 => 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.


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