Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages. Just because a business is in the green today doesn’t mean it will thrive tomorrow.
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 that may struggle to keep up.
One Stock to Sell:
Cal-Maine (CALM)
Trailing 12-Month GAAP Operating Margin: 11.7%
Known for brands such as Egg-Land’s Best and Land O’ Lakes, Cal-Maine (NASDAQ:CALM) produces, packages, and distributes eggs.
Why Does CALM Worry Us?
- Products have few die-hard fans as sales have declined by 2.5% annually over the last three years
- Earnings per share decreased by more than its revenue over the last three years, showing each sale was less profitable
- Capital intensity has ramped up over the last year as its free cash flow margin decreased by 13.7 percentage points
Cal-Maine is trading at $81.50 per share, or 56.3x forward P/E. Read our free research report to see why you should think twice about including CALM in your portfolio.
Two Stocks to Watch:
Ulta (ULTA)
Trailing 12-Month GAAP Operating Margin: 12.4%
Offering high-end prestige brands as well as lower-priced, mass-market ones, Ulta Beauty (NASDAQ:ULTA) is an American retailer that sells makeup, skincare, haircare, and fragrance products.
Why Does ULTA Stand Out?
- Aggressive strategy of rolling out new stores to gobble up whitespace is prudent given its same-store sales growth
- Brick-and-mortar locations are witnessing elevated demand as their same-store sales growth averaged 3.5% over the past two years
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
Ulta’s stock price of $519.50 implies a valuation ratio of 17.8x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
FTAI Aviation (FTAI)
Trailing 12-Month GAAP Operating Margin: 23.9%
With a focus on the CFM56 engine that powers Boeing and Airbus’s planes, FTAI Aviation (NASDAQ:FTAI) sells, leases, maintains, and repairs aircraft engines.
Why Will FTAI Outperform?
- Impressive 50.5% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Earnings per share grew by 35.1% annually over the last two years and trumped its peers
- Cash burn has become less severe over the last five years, showing the company is making some progress toward financial sustainability
At $199.35 per share, FTAI Aviation trades at 14.7x forward EV-to-EBITDA. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
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 Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.