Adtalem Global Education Inc. (NYSE:ATGE) recently posted some strong earnings, and the market responded positively. Our analysis found some more factors that we think are good for shareholders.

How Do Unusual Items Influence Profit?

For anyone who wants to understand Adtalem Global Education's profit beyond the statutory numbers, it's important to note that during the last twelve months statutory profit was reduced by US$53m due to unusual items. It's never great to see unusual items costing the company profits, but on the upside, things might improve sooner rather than later. When we analysed the vast majority of listed companies worldwide, we found that significant unusual items are often not repeated. 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 Adtalem Global Education 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 Adtalem Global Education's Profit Performance

Because unusual items detracted from Adtalem Global Education's earnings over the last year, you could argue that we can expect an improved result in the current quarter. Based on this observation, we consider it likely that Adtalem Global Education's statutory profit actually understates its earnings potential! And on top of that, its earnings per share increased by 55% in 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. 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. While conducting our analysis, we found that Adtalem Global Education has 1 warning sign and it would be unwise to ignore this.

Today we've zoomed in on a single data point to better understand the nature of Adtalem Global Education'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 that insiders are buying.

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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.