Teqnion's (STO:TEQ) Weak Earnings May Only Reveal A Part Of The Whole Picture

The market rallied behind Teqnion AB (publ)'s (STO:TEQ) stock, leading do a rise in the share price after its recent weak earnings report. We think that shareholders might be missing some concerning factors that our analysis found.

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The Impact Of Unusual Items On Profit

Importantly, our data indicates that Teqnion's profit received a boost of kr29m in unusual items, over the last year. While we like to see profit increases, we tend to be a little more cautious when unusual items have made a big contribution. We ran the numbers on most publicly listed companies worldwide, and it's very common for unusual items to be once-off in nature. And that's as you'd expect, given these boosts are described as 'unusual'. We can see that Teqnion's positive unusual items were quite significant relative to its profit in the year to September 2025. As a result, we can surmise that the unusual items are making its statutory profit significantly stronger than it would otherwise be.

Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of Teqnion.

Our Take On Teqnion's Profit Performance

As we discussed above, we think the significant positive unusual item makes Teqnion's earnings a poor guide to its underlying profitability. As a result, we think it may well be the case that Teqnion's underlying earnings power is lower than its statutory profit. In further bad news, its earnings per share decreased in the last year. The goal of this article has been to assess how well we can rely on the statutory earnings to reflect the company's potential, but there is plenty more to consider. If you'd like to know more about Teqnion as a business, it's important to be aware of any risks it's facing. While conducting our analysis, we found that Teqnion has 4 warning signs and it would be unwise to ignore these.

Today we've zoomed in on a single data point to better understand the nature of Teqnion'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.