Even if a company is profitable, it doesn’t always mean it’s a great investment. Some struggle to maintain growth, face looming threats, or fail to reinvest wisely, limiting their future potential.

Not all profitable companies are created equal, and that’s why we built StockStory - to help you find the ones that truly shine bright. Keeping that in mind, here is one profitable company that balances growth and profitability and two best left off your watchlist.

Two Stocks to Sell:

Charter (CHTR)

Trailing 12-Month GAAP Operating Margin: 24%

Operating as Spectrum, Charter (NASDAQ: CHTR) is a leading telecommunications company offering cable television, high-speed internet, and voice services across the United States.

Why Are We Wary of CHTR?

1. Number of internet subscribers has disappointed over the past two years, indicating weak demand for its offerings
2. Projected sales for the next 12 months are flat and suggest demand will be subdued
3. ROIC of 9.8% reflects management’s challenges in identifying attractive investment opportunities

Charter’s stock price of $267.90 implies a valuation ratio of 6.4x forward P/E. Dive into our free research report to see why there are better opportunities than CHTR.

Kennametal (KMT)

Trailing 12-Month GAAP Operating Margin: 7.3%

Involved in manufacturing hard tips of anti-tank projectiles in World War II, Kennametal (NYSE: KMT) is a provider of industrial materials and tools for various sectors.

Why Should You Sell KMT?

1. Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
2. Anticipated sales growth of 1.4% for the next year implies demand will be shaky
3. Earnings per share have dipped by 5.4% annually over the past two years, which is concerning because stock prices follow EPS over the long term

Kennametal is trading at $21.44 per share, or 14.6x forward P/E. If you’re considering KMT for your portfolio, see our FREE research report to learn more.

One Stock to Watch:

Humana (HUM)

Trailing 12-Month GAAP Operating Margin: 2.7%

With over 80% of its revenue derived from federal government contracts, Humana (NYSE: HUM) provides health insurance plans and healthcare services to approximately 17 million members, with a strong focus on Medicare Advantage plans for seniors.

Why Could HUM Be a Winner?

1. 11.8% annual revenue growth over the last five years was better than the sector average, highlighting the value of its products and services
2. Dominant market position is represented by its $123.1 billion in revenue, which gives it negotiating power over membership pricing and reimbursement rates
3. ROIC punches in at 49%, illustrating management’s expertise in identifying profitable investments

At $298 per share, Humana trades at 20.1x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. 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-small-cap company Comfort Systems (+782% 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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