The market was pleased with the recent earnings report from Modine Manufacturing Company (NYSE:MOD), despite the profit numbers being soft. However, we think the company is showing some signs that things are more promising than they seem.

The Impact Of Unusual Items On Profit

For anyone who wants to understand Modine Manufacturing's profit beyond the statutory numbers, it's important to note that during the last twelve months statutory profit was reduced by US$149m 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, after all, that's exactly what the accounting terminology implies. In the twelve months to December 2025, Modine Manufacturing 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.

Our Take On Modine Manufacturing's Profit Performance

As we discussed above, we think the significant unusual expense will make Modine Manufacturing's statutory profit lower than it would otherwise have been. Because of this, we think Modine Manufacturing'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 35% per year over the last three years. 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 Modine Manufacturing as a business, it's important to be aware of any risks it's facing.

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

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.