Gross Margin % is calculated as gross profit divided by its revenue. Target Hospitality's Gross Profit for the
three
months ended in Dec. 2023 was $62.2 Mil. Target Hospitality's Revenue for the
three
months ended in Dec. 2023 was $126.2 Mil. Therefore, Target Hospitality's Gross Margin % for the quarter that ended in Dec. 2023 was 49.31%.
The historical rank and industry rank for Target Hospitality's Gross Margin % or its related term are showing as below:
TH'
s Gross Margin % Range Over the Past 10 Years
Min: 25.39 Med: 39.52 Max: 55.59
Current: 55.59
During the past 7 years, the highestGross Margin % of Target Hospitality was 55.59%. The lowest was 25.39%. And the median was 39.52%.
TH's Gross Margin % is ranked better than 75.25% of 994
companies
in the Business Services industry
Industry Median: 34.85
vs TH: 55.59
Target Hospitality had a gross margin of 49.31% for the quarter that ended in Dec. 2023 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Target Hospitality was 7.40% per year.
Target Hospitality Gross Margin % Historical Data
The historical data trend for Target Hospitality'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 Specialty Business Services subindustry, Target Hospitality'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.
Target Hospitality Gross Margin % Distribution
For the Business Services industry and Industrials sector, Target Hospitality's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Target Hospitality'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
Target Hospitality had a gross margin of 49.31% for the quarter that ended in Dec. 2023 => 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.
Target Hospitality Gross Margin % Related Terms
Thank you for viewing the detailed overview of Target Hospitality's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Target Hospitality (Target Hospitality) Business Description
Target Hospitality Corp is a vertically integrated specialty rental and hospitality services company in the United States. The company provides vertically integrated specialty rental and comprehensive hospitality services including catering food services, maintenance, housekeeping, grounds-keeping, on-site security, overall workforce lodge management, and laundry service. Its operating segment includes HFS-South and HFS-Midwest; Government; TCPL Keystone and others. It generates a majority of its revenue from the Government segment which consists primarily of specialty rental and vertically integrated hospitality services revenue from customers with Government contracts located in Texas.
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