This value measures the percent of revenue left after paying all direct production expenses. It is calculated as the trailing 12 months Total Revenue minus the trailing 12 months Cost of Goods Sold divided by the trailing 12 months Total Revenue and multiplied by 100.
Total profit made in a year as a percentage of sales. This ratio is deemed to be an important indicator of profitability, and comparisons can be made against companies selling similar items. Since gross profit is defined as "turnover minus cost of sales" this ratio will move if the relationship between these two variables changes. This could be due to changes in selling price, unit costs or product mix (where gross margins vary between different markets). The published information can only provide a superficial guide. Analysts will seek to further analyse this ratio into appropriate market segments. Gross margin = Gross profit Turnover
Gross profit margin is a measurement of a company's manufacturing and distribution efficiency during the production process. Gross Profit Margin can be calculated by dividing gross profit by total revenue.
The excess of revenue over cost of goods sold. Gross profit on an individual sale is equal to the selling price minus the cost of acquiring and preparing the goods for sale, but before subtracting selling and administrative expenses. Gross profit margin represents the gross profit as a percentage of sales.
The money left after a company pays for the cost of its goods or services sold. We use this screen to eliminate companies that don't have a scalable business. "Scalable" means that the costs to actually produce the service or product of a New Economy company should be relatively fixed so that when unit volume hits critical mass, gross profit margins (sales price minus cost of goods sold) stay high or go higher. A company with a gross margin less than 50% does not make it on our team. Seventy percent or higher is our usual cut-off-and many of our WaveRider companies earn 80% gross profit margins.
A company's gross profit (net sales minus cost of goods sold) divided by net sales, expressed as a percentage. If a company has $10 million in net sales and its cost of goods sold is $8 million, its gross profit would be $2 million. Its gross profit margin would be $2 million divided by $10 million X 100 = 20%. Gross profit margin indicates how efficiently management turns over the company's goods at a profit.