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 is one profitable company that leverages its financial strength to beat the competition and two best left off your watchlist.

Two Stocks to Sell:

Boot Barn (BOOT)

Trailing 12-Month GAAP Operating Margin: 12.5%

With a strong store presence in Texas, California, Florida, and Oklahoma, Boot Barn (NYSE: BOOT) is a western-inspired apparel and footwear retailer.

Why Are We Hesitant About BOOT?

1. Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
2. Subscale operations are evident in its revenue base of $1.91 billion, meaning it has fewer distribution channels than its larger rivals
3. Free cash flow margin shrank by 7.1 percentage points over the last year, suggesting the company is consuming more capital to stay competitive

Boot Barn’s stock price of $172 implies a valuation ratio of 27.8x forward P/E. To fully understand why you should be careful with BOOT, check out our full research report (it’s free).

Anheuser-Busch (BUD)

Trailing 12-Month GAAP Operating Margin: 25.9%

Born out of a complicated web of mergers and acquisitions, Anheuser-Busch InBev (NYSE: BUD) boasts a powerhouse beer portfolio of Budweiser, Stella Artois, Corona, and local favorites around the world.

Why Is BUD Not Exciting?

1. Sizable revenue base leads to growth challenges as its 2.1% annual revenue increases over the last three years fell short of other consumer staples companies
2. Falling unit sales over the past two years imply it may need to invest in product improvements to get back on track
3. Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth

At $70 per share, Anheuser-Busch trades at 8.4x forward EV-to-EBITDA. If you’re considering BUD for your portfolio, see our FREE research report to learn more.

One Stock to Watch:

Qualcomm (QCOM)

Trailing 12-Month GAAP Operating Margin: 27.2%

Having been at the forefront of developing the standards for cellular connectivity for over four decades, Qualcomm (NASDAQ: QCOM) is a leading innovator and a fabless manufacturer of wireless technology chips used in smartphones, autos and internet of things appliances.

Why Does QCOM Stand Out?

1. Solid 11.2% annual revenue growth over the last five years indicates its offering’s solve complex business issues
2. Robust free cash flow margin of 30.5% gives it many options for capital deployment
3. Industry-leading 52.2% return on capital demonstrates management’s skill in finding high-return investments

Qualcomm is trading at $160.28 per share, or 13.5x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

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 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 Comfort Systems (+782% 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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