Investors were disappointed with the weak earnings posted by Aptiv PLC (NYSE:APTV ). Despite the soft profit numbers, our analysis has optimistic about the overall quality of the income statement.
For anyone who wants to understand Aptiv’s profit beyond the statutory numbers, it’s important to note that during the last twelve months statutory profit was reduced by US$1.0b due 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. In the twelve months to September 2025, Aptiv had a big unusual items expense. As a result, we can surmise that the unusual items made its statutory profit significantly weaker than it would otherwise be.
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.
As we discussed above, we think the significant unusual expense will make Aptiv’s statutory profit lower than it would otherwise have been. Because of this, we think Aptiv’s underlying earnings potential is as good as, or possibly even better, than the statutory profit makes it seem! And on top of that, its earnings per share have grown at 13% per year over the last three years. 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. So while earnings quality is important, it’s equally important to consider the risks facing Aptiv at this point in time. For example, we’ve discovered 3 warning signs that you should run your eye over to get a better picture of Aptiv.
This note has only looked at a single factor that sheds light on the nature of Aptiv’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. 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.