Unprofitable companies can burn through cash quickly, leaving investors exposed if they fail to turn things around. Without a clear path to profitability, these businesses risk running out of capital or relying on dilutive fundraising.
Unprofitable companies face an uphill battle, but not all are created equal. Luckily for you, StockStory is here to separate the promising ones from the weak. Keeping that in mind, here are two unprofitable companies that could turn today’s losses into long-term gains and one best left off your radar.
One Stock to Sell:
Asure Software (ASUR)
Trailing 12-Month GAAP Operating Margin: -9.6%
Operating in the often-overlooked smaller metropolitan markets where HR expertise can be scarce, Asure Software (NASDAQ:ASUR) provides cloud-based human capital management software and services that help small and medium-sized businesses manage payroll, taxes, time tracking, and HR compliance.
Why Do We Think ASUR Will Underperform?
- 4% annual revenue growth over the last two years was slower than its software peers
- Operating margin failed to increase over the last year, indicating the company couldn’t optimize its expenses
- Low free cash flow margin of 5.5% for the last year gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
Asure Software is trading at $8.56 per share, or 1.6x forward price-to-sales. If you’re considering ASUR for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Snowflake (SNOW)
Trailing 12-Month GAAP Operating Margin: -34.3%
Named after the unique architecture of its data warehouse which resembles a snowflake pattern, Snowflake (NYSE:SNOW) provides a cloud-based data platform that enables organizations to consolidate, analyze, and share data across multiple cloud providers.
Why Will SNOW Beat the Market?
- Winning new contracts that can potentially increase in value as its billings growth has averaged 30.5% over the last year
- Revenue outlook for the upcoming 12 months is outstanding and shows it’s on track to gain market share
- Free cash flow margin is anticipated to expand by 8.1 percentage points over the next year, providing additional flexibility for investments and share buybacks/dividends
At $176.57 per share, Snowflake trades at 10.4x forward price-to-sales. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
iRhythm (IRTC)
Trailing 12-Month GAAP Operating Margin: -9.1%
Pioneering the shift from bulky, short-term heart monitors to sleek, wire-free patches, iRhythm Technologies (NASDAQ:IRTC) provides wearable cardiac monitoring devices and AI-powered analysis services that help physicians detect and diagnose heart rhythm disorders.
Why Are We Positive On IRTC?
- Annual revenue growth of 23.4% over the past five years was outstanding, reflecting market share gains this cycle
- Adjusted operating margin improvement of 17.1 percentage points over the last five years demonstrates its ability to scale efficiently
- Free cash flow margin is now positive, indicating the company has achieved financial self-sustainability
iRhythm’s stock price of $148.62 implies a valuation ratio of 54.4x forward EV-to-EBITDA. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here 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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.