Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages. Just because a business is in the green today doesn’t mean it will thrive tomorrow.
Profits are valuable, but they’re not everything. At StockStory, we help you identify the companies that have real staying power. That said, here is one profitable company that balances growth and profitability and two that may struggle to keep up.
Two Stocks to Sell:
BD (BDX)
Trailing 12-Month GAAP Operating Margin: 11.8%
With a history dating back to 1897 and a presence in virtually every hospital around the globe, Becton Dickinson (NYSE: BDX) develops and manufactures medical supplies, devices, laboratory equipment and diagnostic products used by healthcare institutions and professionals worldwide.
Why Do We Think Twice About BDX?
- Annual sales growth of 5.7% over the last five years lagged behind its healthcare peers as its large revenue base made it difficult to generate incremental demand
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 5.6 percentage points
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
BD is trading at $189.71 per share, or 12.8x forward P/E. If you’re considering BDX for your portfolio, see our FREE research report to learn more.
Main Street Capital (MAIN)
Trailing 12-Month GAAP Operating Margin: 64.7%
With a focus on building long-term partnerships rather than quick transactions, Main Street Capital (NYSE: MAIN) is a business development company that provides long-term debt and equity capital to lower middle market and middle market companies.
Why Are We Wary of MAIN?
- Performance over the past two years shows its incremental sales were less profitable as its earnings per share were flat
- Muted 7.5% annual tangible book value per share growth over the last two years shows its capital generation lagged behind its financials peers
Main Street Capital’s stock price of $55.66 implies a valuation ratio of 14.1x forward P/E. Check out our free in-depth research report to learn more about why MAIN doesn’t pass our bar.
One Stock to Buy:
Primoris (PRIM)
Trailing 12-Month GAAP Operating Margin: 5.7%
Listed on the NASDAQ in 2008, Primoris (NYSE: PRIM) builds, maintains, and upgrades infrastructure in the utility, energy, and civil construction industries.
Why Is PRIM a Top Pick?
- Backlog has averaged 143% growth over the past two years, showing it has a pipeline of unfulfilled orders that will support revenue in the future
- Earnings per share have massively outperformed its peers over the last two years, increasing by 39.1% annually
- Free cash flow margin grew by 5.9 percentage points over the last five years, giving the company more chips to play with
At $116.80 per share, Primoris trades at 21.3x forward P/E. Is now a good time to buy? See for yourself in our comprehensive 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 9 Market-Beating Stocks. 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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