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Materialise NV's (NASDAQ:MTLS) strong earnings report was rewarded with a positive stock price move. Our analysis found some more factors that we think are good for shareholders.
View our latest analysis for Materialise
How Do Unusual Items Influence Profit?
Importantly, our data indicates that Materialise's profit was reduced by €9.4m, due to unusual items, over the last year. While deductions due to unusual items are disappointing in the first instance, there is a silver lining. When we analysed the vast majority of listed companies worldwide, we found that significant unusual items are often not repeated. And, after all, that's exactly what the accounting terminology implies. Materialise took a rather significant hit from unusual items in the year to September 2024. All else being equal, this would likely have the effect of making the statutory profit look worse than its underlying earnings power.
That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates.
Our Take On Materialise's Profit Performance
As we mentioned previously, the Materialise's profit was hampered by unusual items in the last year. Based on this observation, we consider it possible that Materialise's statutory profit actually understates its earnings potential! Furthermore, it has done a great job growing EPS over the last year. At the end of the day, it's essential to consider more than just the factors above, if you want to understand the company properly. If you want to do dive deeper into Materialise, you'd also look into what risks it is currently facing. Case in point: We've spotted 1 warning sign for Materialise you should be aware of.
Today we've zoomed in on a single data point to better understand the nature of Materialise's profit. But there are plenty of other ways to inform your opinion of a company. Some people consider a high return on equity to be a good sign of a quality business. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks with significant insider holdings to be useful.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.