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.
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 best left off your watchlist.
Two Stocks to Sell:
Flywire (FLYW)
Trailing 12-Month GAAP Operating Margin: 1.1%
Initially created to solve the challenges of international student tuition payments, Flywire (NASDAQ: FLYW) provides specialized payment processing and software solutions that help educational institutions, healthcare systems, travel companies, and businesses manage complex payments.
Why Does FLYW Fall Short?
- Gross margin of 62.6% reflects its relatively high servicing costs
- Extended payback periods on sales investments suggest the company’s platform isn’t resonating enough to drive efficient sales conversions
- Operating profits and efficiency rose over the last year as it benefited from some fixed cost leverage
Flywire’s stock price of $13.09 implies a valuation ratio of 2.5x forward price-to-sales. To fully understand why you should be careful with FLYW, check out our full research report (it’s free for active Edge members).
Insteel (IIIN)
Trailing 12-Month GAAP Operating Margin: 8.4%
Growing from a small wire manufacturer to one of the largest in the U.S., Insteel (NYSE: IIIN) provides steel wire reinforcing products for concrete.
Why Does IIIN Give Us Pause?
- Flat sales over the last two years suggest it must find different ways to grow during this cycle
- Free cash flow margin shrank by 5.9 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
Insteel is trading at $30.44 per share, or 10.4x forward P/E. Check out our free in-depth research report to learn more about why IIIN doesn’t pass our bar.
One Stock to Buy:
EVERTEC (EVTC)
Trailing 12-Month GAAP Operating Margin: 21.2%
Operating one of Latin America's leading PIN debit networks called ATH, EVERTEC (NYSE: EVTC) is a payment transaction processor and financial technology provider that enables merchants and financial institutions across Latin America and the Caribbean to accept and process electronic payments.
Why Is EVTC a Top Pick?
- Annual revenue growth of 16.8% over the last two years was superb and indicates its market share increased during this cycle
- Earnings per share have grown by 12.5% annually over the last five years, slightly higher than the industry average
- Industry-leading 30.8% return on equity demonstrates management’s skill in finding high-return investments
At $29 per share, EVERTEC trades at 7.9x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.
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-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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