2 Profitable Stocks with Solid Fundamentals and 1 We Avoid

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CSL Cover Image

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.

A business making money today isn’t necessarily a winner, which is why we analyze companies across multiple dimensions at StockStory. Keeping that in mind, here are two profitable companies that leverage their financial strength to beat the competition and one best left off your watchlist.

One Stock to Sell:

Carlisle (CSL)

Trailing 12-Month GAAP Operating Margin: 19.9%

Originally founded as Carlisle Tire and Rubber Company, Carlisle Companies (NYSE: CSL) is a multi-industry product manufacturer focusing on construction materials and weatherproofing technologies.

Why Does CSL Fall Short?

  1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
  2. Anticipated sales growth of 6.4% for the next year implies demand will be shaky
  3. Earnings per share lagged its peers over the last two years as they only grew by 3.6% annually

At $324.04 per share, Carlisle trades at 14.5x forward P/E. Dive into our free research report to see why there are better opportunities than CSL.

Two Stocks to Watch:

Cigna (CI)

Trailing 12-Month GAAP Operating Margin: 3.5%

With roots dating back to 1792 and serving millions of customers across the globe, The Cigna Group (NYSE: CI) provides healthcare services through its Evernorth Health Services and Cigna Healthcare segments, offering pharmacy benefits, specialty care, and medical plans.

Why Are We Positive on CI?

  1. Offerings and unique value proposition resonate with customers, as seen in its above-market 13.8% annual sales growth over the last two years
  2. Massive revenue base of $282.1 billion gives it meaningful leverage when negotiating reimbursement rates
  3. Earnings per share have comfortably outperformed the peer group average over the last five years, increasing by 12% annually

Cigna is trading at $269.49 per share, or 8.6x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

IMAX (IMAX)

Trailing 12-Month GAAP Operating Margin: 20.2%

Originally developed for World Expo '67 in Montreal as an innovative projection system, IMAX (NYSE: IMAX) provides proprietary large-format cinema technology and systems that deliver immersive movie experiences with enhanced image quality and sound.

Why Should You Buy IMAX?

  1. Annual revenue growth of 17.9% over the last five years was superb and indicates its market share increased during this cycle
  2. Free cash flow margin expanded by 24.8 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
  3. Historical investments are beginning to pay off as its returns on capital are growing

IMAX’s stock price of $54.44 implies a valuation ratio of 26x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

High-Quality Stocks for All Market Conditions

ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.

Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.

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