Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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.
Profits are valuable, but they’re not everything. At StockStory, we help you identify the companies that have real staying power. That said, here is one profitable company that generates reliable profits without sacrificing growth and two best left off your watchlist.
Two Stocks to Sell:
Bloomin' Brands (BLMN)
Trailing 12-Month GAAP Operating Margin: 1.2%
Owner of the iconic Australian-themed Outback Steakhouse, Bloomin’ Brands (NASDAQ:BLMN) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.
Why Are We Out on BLMN?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its menu offerings and dining experience
- Sales are projected to be flat over the next 12 months and imply weak demand
- 6× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings
At $11.30 per share, Bloomin' Brands trades at 12.1x forward P/E. If you’re considering BLMN for your portfolio, see our FREE research report to learn more.
Western Union (WU)
Trailing 12-Month GAAP Operating Margin: 16.1%
With a history dating back to 1851 when it began as a telegraph company, Western Union (NYSE:WU) is a global money transfer service that enables consumers and businesses to send funds across borders and currencies, typically within minutes.
Why Do We Avoid WU?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 3.2% annually over the last five years
- Sales were less profitable over the last five years as its earnings per share fell by 5.3% annually, worse than its revenue declines
Western Union is trading at $7.28 per share, or 5.1x forward P/E. Dive into our free research report to see why there are better opportunities than WU.
One Stock to Buy:
Nextpower (NXT)
Trailing 12-Month GAAP Operating Margin: 19.3%
With its technology playing a key role in the massive 1.2 gigawatt Noor Abu Dhabi solar farm project, Nextpower (NASDAQ:NXT) is a provider of solar tracker systems that help solar panels follow the sun.
Why Is NXT a Top Pick?
- Impressive 15.1% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Free cash flow margin increased by 23.4 percentage points over the last five years, giving the company more capital to invest or return to shareholders
- Returns on capital are climbing as management makes more lucrative bets
Nextpower’s stock price of $88.47 implies a valuation ratio of 17.7x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth 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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.