While profitability is essential, it doesn’t guarantee long-term success. Some companies that rest on their margins will lose ground as competition intensifies - as Jeff Bezos said, "Your margin is my opportunity".
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 are two profitable companies that generate reliable profits without sacrificing growth and one best left off your watchlist.
One Stock to Sell:
Hain Celestial (HAIN)
Trailing 12-Month GAAP Operating Margin: 2.3%
Sold in over 75 countries around the world, Hain Celestial (NASDAQ: HAIN) is a natural and organic food company whose products range from snacks to teas to baby food.
Why Do We Pass on HAIN?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Sales were less profitable over the last three years as its earnings per share fell by 32.1% annually, worse than its revenue declines
- 6× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
Hain Celestial is trading at $0.73 per share, or 15.2x forward P/E. To fully understand why you should be careful with HAIN, check out our full research report (it’s free).
Two Stocks to Watch:
Vita Coco (COCO)
Trailing 12-Month GAAP Operating Margin: 14.7%
Founded in 2004 followed by a 2021 IPO, The Vita Coco Company (NASDAQ: COCO) offers coconut water products that are a natural way to quench thirst.
Why Is COCO a Good Business?
- Products are selling at a rapid clip as its unit sales averaged an outstanding 13.8% growth rate over the past two years
- Earnings per share have massively outperformed its peers over the last three years, increasing by 52.4% annually
- Industry-leading 37.2% return on capital demonstrates management’s skill in finding high-return investments, and its rising returns show it’s making even more lucrative bets
Vita Coco’s stock price of $79.55 implies a valuation ratio of 43.2x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
GE Vernova (GEV)
Trailing 12-Month GAAP Operating Margin: 3.9%
Born from the energy business of industrial giant General Electric in a 2023 spin-off, GE Vernova (NYSE: GEV) designs, manufactures, and services power generation equipment and grid technologies to help customers build more reliable and sustainable electric systems.
Why Is GEV on Our Radar?
- Demand for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust revenue growth of 20.4%
- Earnings growth has massively outpaced its peers over the last one years as its EPS has compounded at 223% annually
- Free cash flow margin increased by 41.9 percentage points over the last four years, giving the company more capital to invest or return to shareholders
At $1,011 per share, GE Vernova trades at 56.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
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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.
