ATONEUTRAL

Gross Margin

46.0%

Higher than 64% of Utilities sector peers

Updated 1688h ago

Sector Performance

64th percentile

ATO

46.0%

Sector Median

43.3%

Sector Avg

46.7%

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Deep Analysis

Atmos Energy’s gross margin of 46.0% means that for every dollar of revenue, 46 cents remain after paying the direct costs of delivering natural gas (the rest covers operating expenses and profit).

This is below the sector median of 59.5%, placing the company in the 36th percentile—meaning 64% of utility peers have higher gross margins. Year-over-year and quarter-over-quarter changes are both N/A, and the trend direction over the last eight quarters is also N/A because only a single data point is available. With no trend to assess, the current below-median level alone suggests a structural cost disadvantage relative to peers, which could pressure profitability if not addressed. This metric contradicts the overall NEUTRAL verdict, as a gross margin well below the sector median typically signals weaker pricing power or higher input costs, tilting the risk profile more negative than neutral.

Frequently Asked Questions

What does the Gross Margin tell investors about ATO?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does ATO's Gross Margin compare to its sector?

ATO's Gross Margin of 46.0% compares to a Utilities sector median of 43.3%, placing it in the 64th percentile.

Who are ATO's closest peers by Gross Margin?

The closest Utilities peers by Gross Margin include: PPL (43.9%), LNT (42.6%), PCG (39.8%), PNW (37.9%), PEG (36.5%).

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.