The historical rank and industry rank for Encore Wire's Gross Margin % or its related term are showing as below:
WIRE'
s Gross Margin % Range Over the Past 10 Years
Min: 10.71 Med: 14.08 Max: 36.86
Current: 23.1
During the past 13 years, the highestGross Margin % of Encore Wire was 36.86%. The lowest was 10.71%. And the median was 14.08%.
WIRE's Gross Margin % is ranked worse than 59.93% of 2937
companies
in the Industrial Products industry
Industry Median: 26.42
vs WIRE: 23.10
Encore Wire had a gross margin of 21.52% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Encore Wire was 21.00% per year.
Encore Wire Gross Margin % Historical Data
The historical data trend for Encore Wire'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 Encore Wire's Gross Margin %
For the Electrical Equipment & Parts subindustry, Encore Wire'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.
Encore Wire's Gross Margin % Distribution in the Industrial Products Industry
For the Industrial Products industry and Industrials sector, Encore Wire's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Encore Wire'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.
Encore Wire (NAS:WIRE) 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
Encore Wire had a gross margin of 21.52% 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.
Encore Wire Gross Margin % Related Terms
Thank you for viewing the detailed overview of Encore Wire's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Encore Wire Corp is engaged in manufacturing electrical building wire and cable. It supplies building wire for interior electrical wiring in commercial and industrial buildings, homes, apartments, and manufactured housing. The company's principal customers are wholesale electrical distributors, who sell building wire and a variety of other products to electrical contractors. Encore offers an electrical building wire product line that consists primarily of NM-B cable, UF-B cable, THHN/THWN-2, XHHW-2, RHH/RHW-2, and other types of wire products, including tray cable, metal-clad, and armored cable.
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