Profitable companies tend to be more resilient, giving them the flexibility to invest and return capital to shareholders. Businesses that consistently generate earnings can better navigate downturns and capitalize on new opportunities.
Identifying the most compelling profitable companies isn’t always straightforward, and that’s why we started StockStory. Keeping that in mind, here are three profitable companies that generate reliable profits without sacrificing growth.
AZEK (AZEK)
Trailing 12-Month GAAP Operating Margin: 15.5%
With a significant portion of its products made from recycled materials, AZEK (NYSE: AZEK) designs and manufactures goods for outdoor living spaces.
Why Is AZEK a Good Business?
- Annual revenue growth of 12.4% over the last five years was superb and indicates its market share increased during this cycle
- Share repurchases over the last two years enabled its annual earnings per share growth of 56.9% to outpace its revenue gains
- Free cash flow margin grew by 8.8 percentage points over the last five years, giving the company more chips to play with
At $54.35 per share, AZEK trades at 35.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Magnite (MGNI)
Trailing 12-Month GAAP Operating Margin: 9.4%
Born from the 2020 merger of Rubicon Project and Telaria, Magnite (NASDAQ: MGNI) operates the world's largest independent sell-side advertising platform that automates the buying and selling of digital advertising inventory across all channels and formats.
Why Are We Bullish on MGNI?
- Annual revenue growth of 33.3% over the past five years was outstanding, reflecting market share gains this cycle
- Robust free cash flow margin of 23.6% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
- Rising returns on capital show the company is starting to reap the benefits of its past investments
Magnite is trading at $23.03 per share, or 25.6x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Primerica (PRI)
Trailing 12-Month GAAP Operating Margin: 31.1%
With a sales force of over 140,000 licensed representatives operating on an independent contractor model, Primerica (NYSE: PRI) provides term life insurance, investment products, and other financial services to middle-income households in the United States and Canada.
Why Does PRI Catch Our Eye?
- Share repurchases have increased shareholder returns as its annual earnings per share growth of 19.2% exceeded its revenue gains over the last five years
- Annual book value per share growth of 12.6% over the past five years was outstanding, reflecting strong capital accumulation this cycle
- Industry-leading 25.7% return on equity demonstrates management’s skill in finding high-return investments
Primerica’s stock price of $261.87 implies a valuation ratio of 3.5x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2024 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out 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 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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