Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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 generate reliable profits without sacrificing growth and one that may struggle to keep up.
One Stock to Sell:
Lincoln Educational (LINC)
Trailing 12-Month GAAP Operating Margin: 4.8%
Established in 1946, Lincoln Educational (NASDAQ:LINC) is a provider of specialized technical training in the United States, offering career-oriented programs to provide practical skills required in the workforce.
Why Do We Think LINC Will Underperform?
- Performance surrounding its enrolled students has lagged its peers
- Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
Lincoln Educational is trading at $25.14 per share, or 32.5x forward P/E. To fully understand why you should be careful with LINC, check out our full research report (it’s free).
Two Stocks to Watch:
TaskUs (TASK)
Trailing 12-Month GAAP Operating Margin: 10.9%
Starting as a virtual assistant service in 2008 before evolving into a global digital services provider, TaskUs (NASDAQ:TASK) provides outsourced digital services including customer experience management, content moderation, and AI data services to innovative technology companies.
Why Do We Like TASK?
- Market share has increased this cycle as its 21.1% annual revenue growth over the last five years was exceptional
- Free cash flow margin expanded by 21.6 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
- Historical investments are beginning to pay off as its returns on capital are growing
TaskUs’s stock price of $11.58 implies a valuation ratio of 7.5x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Primerica (PRI)
Trailing 12-Month GAAP Operating Margin: 29.3%
With a sales force of over 140,000 licensed representatives operating on an independent contractor model, Primerica (NYSE:PRI) provides term life insurance, investment products, and other financial services to middle-income households in the United States and Canada.
Why Is PRI on Our Radar?
- Pre-tax profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Performance over the past five years was boosted by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Stellar return on equity showcases management’s ability to surface highly profitable business ventures
At $267.14 per share, Primerica trades at 3.5x forward P/B. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
Check out the high-quality names we’ve flagged in 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 244% over the last five years (as of June 30, 2025).
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 Exlservice (+354% five-year return). Find your next big winner with StockStory today.