Some Investors May Be Willing To Look Past Datalogic's (BIT:DAL) Soft Earnings

Soft earnings didn't appear to concern Datalogic S.p.A.'s (BIT:DAL) shareholders over the last week. We did some digging, and we believe the earnings are stronger than they seem.

See our latest analysis for Datalogic

How Do Unusual Items Influence Profit?

Importantly, our data indicates that Datalogic's profit was reduced by €2.2m, due to unusual items, over the last year. It's never great to see unusual items costing the company profits, but on the upside, things might improve sooner rather than later. We looked at thousands of listed companies and found that unusual items are very often one-off in nature. And, after all, that's exactly what the accounting terminology implies. Datalogic took a rather significant hit from unusual items in the year to March 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 Datalogic's Profit Performance

As we mentioned previously, the Datalogic's profit was hampered by unusual items in the last year. Based on this observation, we consider it possible that Datalogic's statutory profit actually understates its earnings potential! Unfortunately, though, its earnings per share actually fell back over the last year. Of course, we've only just scratched the surface when it comes to analysing its earnings; one could also consider margins, forecast growth, and return on investment, among other factors. If you'd like to know more about Datalogic as a business, it's important to be aware of any risks it's facing. You'd be interested to know, that we found 2 warning signs for Datalogic and you'll want to know about these.

This note has only looked at a single factor that sheds light on the nature of Datalogic's profit. But there is always more to discover if you are capable of focussing your mind on minutiae. 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.