While profitability is essential, it doesn’t guarantee long-term success. Some companies that rest on their margins will lose ground as competition intensifies - as Jeff Bezos said, "Your margin is my opportunity".
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 is one profitable company that generates reliable profits without sacrificing growth and two that may struggle to keep up.
Two Stocks to Sell:
Spectrum Brands (SPB)
Trailing 12-Month GAAP Operating Margin: 4.4%
A leader in multiple consumer product categories, Spectrum Brands (NYSE:SPB) is a diversified company with a portfolio of trusted brands spanning home appliances, garden care, personal care, and pet care.
Why Do We Steer Clear of SPB?
- 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
- Sales are projected to be flat over the next 12 months and imply weak demand
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Spectrum Brands’s stock price of $62.68 implies a valuation ratio of 14.6x forward P/E. If you’re considering SPB for your portfolio, see our FREE research report to learn more.
Interface (TILE)
Trailing 12-Month GAAP Operating Margin: 11.5%
Pioneering carbon-neutral flooring since its founding in 1973, Interface (NASDAQ:TILE) is a global manufacturer of modular carpet tiles, luxury vinyl tile (LVT), and rubber flooring that specializes in carbon-neutral and sustainable flooring solutions.
Why Are We Cautious About TILE?
- Muted 3.3% annual revenue growth over the last five years shows its demand lagged behind its business services peers
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 4.2%
- Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 6.2% annually
Interface is trading at $31.50 per share, or 15.8x forward P/E. Dive into our free research report to see why there are better opportunities than TILE.
One Stock to Buy:
Airbnb (ABNB)
Trailing 12-Month GAAP Operating Margin: 22.6%
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 have grown by 9.4% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
- Disciplined cost controls and effective management resulted in a strong two-year EBITDA margin of 36.4%, and its profits increased over the last few years as it scaled
- ABNB is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
At $130.97 per share, Airbnb trades at 16x forward EV/EBITDA. Is now a good time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.