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.
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 balance growth and profitability and one that may face some trouble.
One Stock to Sell:
Manhattan Associates (MANH)
Trailing 12-Month GAAP Operating Margin: 25.9%
Built on a "versionless" cloud architecture that delivers quarterly updates to all customers, Manhattan Associates (NASDAQ: MANH) develops cloud-based software that helps retailers, wholesalers, and manufacturers manage their supply chains, inventory, and omnichannel operations.
Why Are We Hesitant About MANH?
- Products, pricing, or go-to-market strategy may need some adjustments as its 4.1% average billings growth over the last year was weak
- Sky-high servicing costs result in an inferior gross margin of 56.3% that must be offset through increased usage
- Operating margin failed to increase over the last year, indicating the company couldn’t optimize its expenses
At $137.36 per share, Manhattan Associates trades at 7.4x forward price-to-sales. Dive into our free research report to see why there are better opportunities than MANH.
Two Stocks to Watch:
Coca-Cola (KO)
Trailing 12-Month GAAP Operating Margin: 28.6%
A pioneer and behemoth in carbonated soft drinks, Coca-Cola (NYSE: KO) is a storied beverage company best known for its flagship soda.
Why Is KO Interesting?
- Dominant market position is represented by its $48.06 billion in revenue, which gives it negotiating power with suppliers and retailers
- Unique products and pricing power are reflected in its best-in-class gross margin of 61.3%
- Highly efficient business model is illustrated by its impressive 25% operating margin, and its operating leverage amplified its profits over the last year
Coca-Cola is trading at $75.02 per share, or 23.4x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
United Rentals (URI)
Trailing 12-Month GAAP Operating Margin: 24.7%
Owning the largest rental fleet in the world, United Rentals (NYSE: URI) provides equipment rental and related services to construction, industrial, and infrastructure industries.
Why Do We Like URI?
- Annual revenue growth of 13.5% over the past five years was outstanding, reflecting market share gains this cycle
- Highly efficient business model is illustrated by its impressive 25.9% operating margin, and its rise over the last five years was fueled by some leverage on its fixed costs
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 19.2% exceeded its revenue gains over the last five years
United Rentals’s stock price of $716.98 implies a valuation ratio of 15.5x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
