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".

Profits are valuable, but they’re not everything. At StockStory, we help you identify the companies that have real staying power. Keeping that in mind, here is one profitable company that balances growth and profitability and two that may face some trouble.

Two Stocks to Sell:

Yum China (YUMC)

Trailing 12-Month GAAP Operating Margin: 10.7%

One of China’s largest restaurant companies, Yum China (NYSE: YUMC) is an independent entity spun off from Yum! Brands in 2016.

Why Is YUMC Not Exciting?

1. Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new restaurants
2. Estimated sales growth of 5.2% for the next 12 months is soft and implies weaker demand
3. Gross margin of 20.1% is below its competitors, leaving less money for marketing and promotions

Yum China’s stock price of $44.28 implies a valuation ratio of 16.2x forward P/E. To fully understand why you should be careful with YUMC, check out our full research report (it’s free for active Edge members).

Pitney Bowes (PBI)

Trailing 12-Month GAAP Operating Margin: 13.7%

With a century-long history dating back to 1920 and processing over 15 billion pieces of mail annually, Pitney Bowes (NYSE: PBI) provides shipping, mailing technology, logistics, and financial services to businesses of all sizes.

Why Do We Think Twice About PBI?

1. Sales tumbled by 10.5% annually over the last five years, showing market trends are working against its favor during this cycle
2. Projected sales decline of 1% over the next 12 months indicates demand will continue deteriorating
3. Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 3.8% for the last five years

Pitney Bowes is trading at $10.99 per share, or 8.4x forward P/E. Read our free research report to see why you should think twice about including PBI in your portfolio.

One Stock to Buy:

Celsius (CELH)

Trailing 12-Month GAAP Operating Margin: 14.7%

With its proprietary MetaPlus formula as the basis for key products, Celsius (NASDAQ: CELH) offers energy drinks that feature natural ingredients to help in fitness and weight management.

Why Is CELH a Top Pick?

1. Market share has increased over the last three years as its 50.7% annual revenue growth was exceptional
2. Earnings per share grew by 82.2% annually over the last three years and trumped its peers
3. Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures, and its rising returns show it’s making even more lucrative bets

At $61.20 per share, Celsius trades at 46.9x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.

Stocks We Like Even More

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-micro-cap company Tecnoglass (+1,754% 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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