Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages. Just because a business is in the green today doesn’t mean it will thrive tomorrow.
A business making money today isn’t necessarily a winner, which is why we analyze companies across multiple dimensions at StockStory. Keeping that in mind, here are two profitable companies that generate reliable profits without sacrificing growth and one that may struggle to keep up.
One Stock to Sell:
Columbus McKinnon (CMCO)
Trailing 12-Month GAAP Operating Margin: 6.6%
With 19 different brands across the globe, Columbus McKinnon (NASDAQ: CMCO) offers material handling equipment for the construction, manufacturing, and transportation industries.
Why Should You Sell CMCO?
- Flat sales over the last two years suggest it must find different ways to grow during this cycle
- Sales over the last two years were less profitable as its earnings per share fell by 9.3% annually while its revenue was flat
- Free cash flow margin shrank by 7.4 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
Columbus McKinnon is trading at $14.72 per share, or 5.4x forward P/E. Dive into our free research report to see why there are better opportunities than CMCO.
Two Stocks to Watch:
Airbnb (ABNB)
Trailing 12-Month GAAP Operating Margin: 22.5%
Founded by Brian Chesky and Joe Gebbia in their San Francisco apartment, Airbnb (NASDAQ: ABNB) is the world’s largest online marketplace for lodging, primarily homestays.
Why Is ABNB a Top Pick?
- Nights and Experiences Booked are rising, meaning the company can increase revenue without incurring additional customer acquisition costs if it can cross-sell additional products and features
- Share buybacks catapulted its annual earnings per share growth to 28.4%, which outperformed its revenue gains over the last three years
- ABNB is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
At $122.80 per share, Airbnb trades at 17.6x forward EV/EBITDA. Is now the right time to buy? See for yourself in our full research report, it’s free.
Abercrombie and Fitch (ANF)
Trailing 12-Month GAAP Operating Margin: 14.6%
Founded as an outdoor and sporting brand, Abercrombie & Fitch (NYSE: ANF) evolved to become a specialty retailer that sells its own brand of fashionable clothing to young adults.
Why Do We Like ANF?
- Same-store sales growth averaged 13.5% over the past two years, showing it’s bringing new and repeat shoppers into its stores
- Collection of products is difficult to replicate at scale and results in a best-in-class gross margin of 63.6%
- Earnings growth has trumped its peers over the last six years as its EPS has compounded at 48.1% annually
Abercrombie and Fitch’s stock price of $87.51 implies a valuation ratio of 8.6x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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