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”.
Profits are valuable, but they’re not everything. At StockStory, we help you identify the companies that have real staying power. Keeping that in mind, here are two profitable companies that generate reliable profits without sacrificing growth and one best left off your watchlist.
One stock to sell:
Payoneer (PAYO)
Trailing 12-Month GAAP Operating Margin: 10.4%
Founded during the early days of global e-commerce in 2005 to solve international payment challenges, Payoneer (NASDAQ: PAYO) provides financial technology services that enable small and medium-sized businesses to send and receive payments globally across borders.
Why Is PAYO Not Exciting?
- Performance over the past two years shows its incremental sales were much less profitable, as its earnings per share fell by 5.2% annually
- Underwhelming 7.9% return on equity reflects management’s difficulties in finding profitable growth opportunities
At $7.17 per share, Payoneer trades at 19x forward P/E. Read our free research report to see why you should think twice about including PAYO in your portfolio.
Two stocks to watch:
Boot Barn (BOOT)
Trailing 12-Month GAAP Operating Margin: 13.6%
With a strong store presence in Texas, California, Florida, and Oklahoma, Boot Barn (NYSE: BOOT) is a western-inspired apparel and footwear retailer.
Why Does BOOT Stand Out?
- Aggressive strategy of rolling out new stores to gobble up whitespace is prudent given its same-store sales growth
- Comparable store sales rose by 6.7% on average over the past two years, demonstrating its ability to drive increased spending at existing locations
- Exciting sales outlook for the upcoming 12 months calls for 14.4% growth, an acceleration from its three-year trend
Boot Barn is trading at $119.45 per share, or 13x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Nasdaq (NDAQ)
Trailing 12-Month GAAP Operating Margin: 47.2%
Originally founded in 1971 as the world's first electronic stock market, Nasdaq (NASDAQ: NDAQ) operates global exchanges and provides technology, data, and corporate services that help companies, investors, and financial institutions navigate capital markets.
Why Is NDAQ on Our Radar?
- Annual revenue growth of 12.4% over the last two years beat the sector average and underscores the unique value of its offerings
- Performance over the past two years was boosted by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
Nasdaq’s stock price of $102.66 implies a valuation ratio of 21.2x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
High-quality stocks for all market conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating 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.
