Asker Healthcare Group's (STO:ASKER) Solid Earnings Are Supported By Other Strong Factors

Asker Healthcare Group AB (STO:ASKER) just reported healthy earnings but the stock price didn't move much. Our analysis suggests that investors might be missing some promising details.

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How Do Unusual Items Influence Profit?

To properly understand Asker Healthcare Group's profit results, we need to consider the kr117m expense attributed to unusual items. While deductions due to unusual items are disappointing in the first instance, there is a silver lining. We looked at thousands of listed companies and found that unusual items are very often one-off in nature. And that's hardly a surprise given these line items are considered unusual. Assuming those unusual expenses don't come up again, we'd therefore expect Asker Healthcare Group to produce a higher profit next year, all else being equal.

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 Asker Healthcare Group's Profit Performance

Unusual items (expenses) detracted from Asker Healthcare Group's earnings over the last year, but we might see an improvement next year. Based on this observation, we consider it likely that Asker Healthcare Group's statutory profit actually understates its earnings potential! And on top of that, its earnings per share increased by 44% 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. In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. For example, we've discovered 2 warning signs that you should run your eye over to get a better picture of Asker Healthcare Group.

This note has only looked at a single factor that sheds light on the nature of Asker Healthcare Group's profit. But there are plenty of other ways to inform your opinion of a company. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership.

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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.