Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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.
Not all profitable companies are created equal, and that’s why we built StockStory - to help you find the ones that truly shine bright. That said, here are two profitable companies that generate reliable profits without sacrificing growth and one best left off your watchlist.
One Stock to Sell:
Middleby (MIDD)
Trailing 12-Month GAAP Operating Margin: 16.6%
Holding a Guinness World Record for creating the world’s fastest conveyor pizza oven, Middleby (NYSE: MIDD) is a food service and equipment manufacturer.
Why Are We Out on MIDD?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Projected sales growth of 2.1% for the next 12 months suggests sluggish demand
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 1.2% annually
Middleby is trading at $123.14 per share, or 14.2x forward P/E. Check out our free in-depth research report to learn more about why MIDD doesn’t pass our bar.
Two Stocks to Watch:
Sea (SE)
Trailing 12-Month GAAP Operating Margin: 7.4%
Founded in 2009 and a publicly traded company since 2017, Sea (NYSE: SE) started as a gaming platform and has since expanded to offer a variety of services such as e-commerce, digital payments, and financial services across Southeast Asia.
Why Will SE Beat the Market?
- Has the opportunity to boost monetization through new features and premium offerings as its paying users have grown by 15.3% annually over the last two years
- Additional sales over the last three years increased its profitability as the 41.8% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin expanded by 35.5 percentage points over the last few years, providing additional flexibility for investments and share buybacks/dividends
At $157.95 per share, Sea trades at 26.5x forward EV/EBITDA. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Tecnoglass (TGLS)
Trailing 12-Month GAAP Operating Margin: 26.7%
The first-ever Colombian company to trade on the NASDAQ, Tecnoglass (NYSE: TGLS) is a manufacturer of architectural glass, windows, and aluminum products.
Why Could TGLS Be a Winner?
- Annual revenue growth of 20.3% over the last five years was superb and indicates its market share increased during this cycle
- Healthy operating margin of 27.3% shows it’s a well-run company with efficient processes, and it turbocharged its profits by achieving some fixed cost leverage
- ROIC punches in at 28.9%, illustrating management’s expertise in identifying profitable investments, and its returns are growing as it capitalizes on even better market opportunities
Tecnoglass’s stock price of $58.77 implies a valuation ratio of 13.5x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .
Stocks We Like Even More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Strong Momentum 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-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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