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 are two profitable companies that balance growth and profitability and one that may struggle to keep up.
One Industrials Stock to Sell:
MDU Resources (MDU)
Trailing 12-Month GAAP Operating Margin: 35.6%
Founded to provide electricity to towns in Minnesota, MDU Resources (NYSE: MDU) provides products and services in the utilities and construction materials industries.
Why Are We Out on MDU?
- Sales tumbled by 37.6% annually over the last five years, showing market trends are working against its favor during this cycle
- Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
- High net-debt-to-EBITDA ratio of 7× increases the risk of forced asset sales or dilutive financing if operational performance weakens
MDU Resources is trading at $19.17 per share, or 19.6x forward P/E. Check out our free in-depth research report to learn more about why MDU doesn’t pass our bar.
Two Industrials Stocks to Buy:
Quanta (PWR)
Trailing 12-Month GAAP Operating Margin: 5.7%
A construction engineering services company, Quanta (NYSE: PWR) provides infrastructure solutions to a variety of sectors, including energy and communications.
Why Is PWR a Top Pick?
- Backlog has averaged 20.3% growth over the past two years, showing it has a pipeline of unfulfilled orders that will support revenue in the future
- Estimated revenue growth of 12.7% for the next 12 months implies its momentum over the last two years will continue
- Earnings per share grew by 25.1% annually over the last two years and trumped its peers
Quanta’s stock price of $438 implies a valuation ratio of 37.2x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free for active Edge members.
SPX Technologies (SPXC)
Trailing 12-Month GAAP Operating Margin: 15.7%
With roots dating back to 1912 as the Piston Ring Company, SPX Technologies (NYSE: SPXC) supplies specialized infrastructure equipment for HVAC systems and detection and measurement applications across industrial, commercial, and utility markets.
Why Is SPXC a Good Business?
- Market share has increased this cycle as its 12.5% annual revenue growth over the last two years was exceptional
- Operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
- Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 22.2% annually
At $184.04 per share, SPX Technologies trades at 26.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
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 9 Market-Beating Stocks. 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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