Gross Margin % is calculated as gross profit divided by its revenue. R1 RCM's Gross Profit for the
three
months ended in Dec. 2023 was $134 Mil. R1 RCM's Revenue for the
three
months ended in Dec. 2023 was $575 Mil. Therefore, R1 RCM's Gross Margin % for the quarter that ended in Dec. 2023 was 23.21%.
The historical rank and industry rank for R1 RCM's Gross Margin % or its related term are showing as below:
RCM'
s Gross Margin % Range Over the Past 10 Years
Min: -44.2 Med: 18.16 Max: 66.3
Current: 21.49
During the past 13 years, the highestGross Margin % of R1 RCM was 66.30%. The lowest was -44.20%. And the median was 18.16%.
RCM's Gross Margin % is ranked worse than 81.12% of 609
companies
in the Healthcare Providers & Services industry
Industry Median: 41.53
vs RCM: 21.49
R1 RCM had a gross margin of 23.21% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for R1 RCM was 11.60% per year.
R1 RCM Gross Margin % Historical Data
The historical data trend for R1 RCM'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 Health Information Services subindustry, R1 RCM'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.
R1 RCM's Gross Margin % Distribution in the Healthcare Providers & Services Industry
For the Healthcare Providers & Services industry and Healthcare sector, R1 RCM's Gross Margin % distribution charts can be found below:
* The bar in red indicates where R1 RCM'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.
R1 RCM (NAS:RCM) Gross Margin % 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
R1 RCM had a gross margin of 23.21% 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.
R1 RCM Gross Margin % Related Terms
Thank you for viewing the detailed overview of R1 RCM's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
R1 RCM Inc is a provider of technology-driven solutions that transform the patient experience and financial performance of healthcare providers. Its services help healthcare providers generate sustainable improvements in their operating margins and cash flows while also enhancing patient, physician, and staff satisfaction for the customers, Its service offering consists of end-to-end RCM services for health systems, hospitals, and physician groups that provide comprehensive revenue cycle infrastructure to providers, including all revenue cycle personnel, technology solutions, and process workflow. The majority of the revenue comes from the operating fees received.
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