Gross Margin % is calculated as gross profit divided by its revenue. Dril-Quip's Gross Profit for the
three
months ended in Dec. 2023 was $34.7 Mil. Dril-Quip's Revenue for the
three
months ended in Dec. 2023 was $126.3 Mil. Therefore, Dril-Quip's Gross Margin % for the quarter that ended in Dec. 2023 was 27.43%.
The historical rank and industry rank for Dril-Quip's Gross Margin % or its related term are showing as below:
DRQ'
s Gross Margin % Range Over the Past 10 Years
Min: 23.67 Med: 27.37 Max: 45.6
Current: 27.25
During the past 13 years, the highestGross Margin % of Dril-Quip was 45.60%. The lowest was 23.67%. And the median was 27.37%.
DRQ's Gross Margin % is ranked worse than 51.19% of 926
companies
in the Oil & Gas industry
Industry Median: 27.905
vs DRQ: 27.25
Dril-Quip had a gross margin of 27.43% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Dril-Quip was 1.20% per year.
Dril-Quip Gross Margin % Historical Data
The historical data trend for Dril-Quip'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 Dril-Quip's Gross Margin %
For the Oil & Gas Equipment & Services subindustry, Dril-Quip'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.
Dril-Quip's Gross Margin % Distribution in the Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Dril-Quip's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Dril-Quip'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.
Dril-Quip (NYSE:DRQ) 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
Dril-Quip had a gross margin of 27.43% 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.
Dril-Quip Gross Margin % Related Terms
Thank you for viewing the detailed overview of Dril-Quip's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Dril-Quip Inc. designs, manufactures, sells and services engineered drilling and production equipment for both offshore and onshore applications. The Company's revenues are generated from three sources, Product revenues are derived from the sale of drilling and production equipment. Service revenues are earned when the Company provides technical advisory assistance and rework and reconditioning services. Leasing revenues are derived from rental tools used during the installation and retrieval of the Company's products. The Company's operations are organized into three geographic segments, Western Hemisphere (including North and South America), Eastern Hemisphere (including Europe and Africa) and Asia-Pacific (including the Pacific Rim, Southeast Asia, Australia, India and the Middle East).
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