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. Keeping that in mind, here are two profitable companies that balance growth and profitability and one best left off your watchlist.

One Stock to Sell:

Matthews (MATW)

Trailing 12-Month GAAP Operating Margin: 5.2%

Originally a death care company, Matthews International (NASDAQ: MATW) is a diversified company offering ceremonial services, brand solutions and industrial technologies.

Why Should You Dump MATW?

1. Products and services have few die-hard fans as sales have declined by 6.5% annually over the last two years
2. Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 14.8% annually
3. Cash-burning tendencies make us wonder if it can sustainably generate shareholder value

Matthews is trading at $25.63 per share, or 16.9x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including MATW in your portfolio.

Two Stocks to Buy:

GE Aerospace (GE)

Trailing 12-Month GAAP Operating Margin: 21.3%

One of the original 12 companies on the Dow Jones Industrial Average, General Electric (NYSE: GE) is a multinational conglomerate providing technologies for various sectors including aviation, power, renewable energy, and healthcare.

Why Is GE a Good Business?

1. Annual revenue growth of 12.2% over the last two years was superb and indicates its market share increased during this cycle
2. GE is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
3. Returns on capital are growing as management capitalizes on its market opportunities

GE Aerospace’s stock price of $297.34 implies a valuation ratio of 50.3x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Interactive Brokers (IBKR)

Trailing 12-Month GAAP Operating Margin: 72.2%

Founded in 1977 and known for its sophisticated trading technology and global reach across 150+ exchanges in 34 countries, Interactive Brokers (NASDAQ: IBKR) is a global electronic broker that provides low-cost trading and investment services across stocks, options, futures, forex, bonds, and other financial instruments.

Why Will IBKR Outperform?

1. Annual revenue growth of 22.7% over the last five years was superb and indicates its market share increased during this cycle
2. Performance over the past five years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 27.4% outpaced its revenue gains
3. Annual tangible book value per share growth of 20.2% over the last two years was superb and indicates its capital strength increased during this cycle

At $65.33 per share, Interactive Brokers trades at 32.9x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Donald Trump’s April 2025 "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 5 Growth Stocks for this month. 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 Exlservice (+354% 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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