Companies with solid operating margins have a competitive edge, allowing them to reinvest for sustainable expansion. The best of these businesses balance profitability with reinvestment, setting themselves up for long-term success.
Even among profitable businesses, only a select few truly maximize their potential - and StockStory is here to help you find them. Keeping that in mind, here are three profitable companies that balance growth and profitability.
CSW (CSW)
Trailing 12-Month GAAP Operating Margin: 17.3%
With over two centuries of combined operations manufacturing and supplying, CSW (NYSE: CSW) offers special chemicals, coatings, sealants, and lubricants for various industries.
Why Will CSW Beat the Market?
- Market share has increased this cycle as its 21.2% annual revenue growth over the last five years was exceptional
- Earnings per share grew by 20.5% annually over the last two years and trumped its peers
- Robust free cash flow margin of 15.4% gives it many options for capital deployment, and its improved cash conversion implies it’s becoming a less capital-intensive business
CSW’s stock price of $314.86 implies a valuation ratio of 26.8x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Insulet (PODD)
Trailing 12-Month GAAP Operating Margin: 17.3%
Revolutionizing diabetes care with its tubeless "Pod" technology, Insulet (NASDAQ: PODD) develops and manufactures innovative insulin delivery systems for people with diabetes, primarily through its Omnipod product line.
Why Are We Backing PODD?
- Constant currency growth averaged 26% over the past two years, showing it can expand globally regardless of the macroeconomic environment
- Free cash flow margin increased by 32.6 percentage points over the last five years, giving the company more capital to invest or return to shareholders
- Returns on capital are growing as management capitalizes on its market opportunities
Insulet is trading at $253.94 per share, or 42.6x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Ibotta (IBTA)
Trailing 12-Month GAAP Operating Margin: 3.9%
Originally launched as a way to make grocery shopping more rewarding for budget-conscious consumers, Ibotta (NYSE: IBTA) is a mobile shopping app that allows consumers to earn cash back on everyday purchases by completing tasks and submitting receipts.
Why Does IBTA Stand Out?
- Rise in total redemptions indicates high demand for its offerings
- Additional sales over the last two years increased its profitability as the 292% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin grew by 48.6 percentage points over the last four years, giving the company more chips to play with
At $21.22 per share, Ibotta trades at 17.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
