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”.
Not all profitable companies are created equal, and that’s why we built StockStory - to help you find the ones that truly shine bright. That said, 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:
Lindblad Expeditions (LIND)
Trailing 12-Month GAAP Operating Margin: 7.1%
Founded by explorer Sven-Olof Lindblad in 1979, Lindblad Expeditions (NASDAQ: LIND) offers cruising experiences to remote destinations in partnership with National Geographic.
Why Are We Hesitant About LIND?
- Sales trends were unexciting over the last two years as its 17.4% annual growth was below the typical consumer discretionary company
- Poor expense management has led to an operating margin of 5.8% that is below the industry average
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 8.7% for the last two years
At $22.18 per share, Lindblad Expeditions trades at 89x forward P/E. If you’re considering LIND for your portfolio, see our FREE research report to learn more.
Huntington Ingalls (HII)
Trailing 12-Month GAAP Operating Margin: 5.1%
Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE: HII) develops marine vessels and their mission systems and maintenance services.
Why Do We Think HII Will Underperform?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 5.3% for the last two years
- Estimated sales growth of 2.4% for the next 12 months implies demand will slow from its two-year trend
- Earnings per share have contracted by 1.5% annually over the last five years, a headwind for returns as stock prices often echo long-term EPS performance
Huntington Ingalls is trading at $317.50 per share, or 17.8x forward P/E. Read our free research report to see why you should think twice about including HII in your portfolio.
One Stock to Watch:
Waste Management (WM)
Trailing 12-Month GAAP Operating Margin: 17.3%
Headquartered in Houston, Waste Management (NYSE: WM) is a provider of comprehensive waste management services in North America.
Why Does WM Stand Out?
- Annual revenue growth of 10.8% over the past two years was outstanding, reflecting market share gains this cycle
- Offerings are mission-critical for businesses and result in a premier gross margin of 39%
- Highly efficient business model is illustrated by its impressive 17.4% operating margin
Waste Management’s stock price of $215.76 implies a valuation ratio of 25.7x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
