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
Applied Energetics had a gross margin of N/A% for the quarter that ended in Mar. 2026 => No sustainable 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.
Applied Energetics Gross Margin % Related Terms
Applied Energetics Gross Margin % Historical Data
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The historical data trend for Applied Energetics'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.
AERG vs MVIS, ARBE, USBC: Gross Margin % Comparison
For the Scientific & Technical Instruments subindustry, Applied Energetics'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.
Applied Energetics Gross Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Applied Energetics's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Applied Energetics'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.
Applied Energetics (AERG) has a Gross Margin % of 0.00% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Applied Energetics and its competitors. Over the past decade, Applied Energetics' Gross Margin % has ranged from 12.50 to 76.61. According to the industry distribution chart, Applied Energetics ranks #530 out of 2450 companies in the Hardware industry, placing it in the top 21.6%.
Is Applied Energetics' Gross Margin % too high?
Applied Energetics' current Gross Margin % is 0.00%. Over the past 10 years, this metric has ranged from a low of 12.50 to a high of 76.61. Based on the distribution chart, Applied Energetics ranks #530 out of 2450 companies in the Hardware industry, which is in the top quartile — a strong position relative to peers. Overall, Applied Energetics has a GF Score™ of 26/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Applied Energetics' Gross Margin % compare to MVIS and ARBE?
According to the Hardware industry distribution chart, Applied Energetics ranks #530 out of 2450 companies for Gross Margin %. This places Applied Energetics in the top 22% of its industry — outperforming the majority of peers. The industry median Gross Margin % is 24.53. Historically, Applied Energetics' own Gross Margin % has ranged from 12.50 to 76.61 over the past decade. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Hardware company?
The median Gross Margin % among Hardware companies is 24.53, based on 2,450 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Applied Energetics and its competitors. For the Hardware industry, the median Gross Margin % is 24.53 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Applied Energetics's current Gross Margin % is 0.00%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Applied Energetics stock overvalued right now?
Based on GuruFocus' analysis, Applied Energetics (AERG) is currently considered Significantly Overvalued. The stock's GF Value™ is $0.33, compared to a current price of $1.25 — trading 278.8% above its estimated fair value. The current Gross Margin % is 0.00%. Applied Energetics' overall GF Score™ is 26/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Applied Energetics (AERG), the current Gross Margin % is 0.00% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Applied Energetics (AERG) Overvalued in 2026?
Based on GuruFocus' analysis, Applied Energetics stock appears to be overvalued.
The current stock price of $1.25 is trading 278.8% above its estimated GF Value™ of $0.33.
GuruFocus considers Applied Energetics to be Significantly Overvalued.
Key valuation signals for AERG:
Gross Margin %: 0.00%
GF Value™: $0.33 vs. price of $1.25 (278.8% above fair value)
No single metric tells the full story. See the AERG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Applied Energetics Inc specializes in laser and photonics systems, particularly fiber-based ultrashort pulse (USP) laser technologies. Its powerful, dual-use systems are designed for integration and deployment on numerous potential defense platforms for the delivery of high-intensity, ultrashort pulses of light to disable or destroy a target or disrupt a mission. These technologies have applications in both national security and commercial markets. The company operates as one operating segment with a focus on the development and manufacture of high-performance lasers and optical systems, and integrated guided energy systems, for prospective defense, national security, industrial, biomedical, and scientific customers across the world.
26GF Score
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