Profitability is a key measure of business strength. Companies with high margins have proven they can generate consistent earnings while maintaining financial discipline.
Even among profitable businesses, only a select few truly maximize their potential - and StockStory is here to help you find them. Keeping that in mind, here are three profitable companies that leverage their financial strength to beat the competition.
AutoZone (AZO)
Trailing 12-Month GAAP Operating Margin: 18%
Aiming to be a one-stop shop for the DIY customer, AutoZone (NYSE: AZO) is an auto parts and accessories retailer that sells everything from car batteries to windshield wiper fluid to brake pads.
Why Is AZO a Top Pick?
- Locations open for at least a year are seeing increased demand as same-store sales have averaged 3.2% growth over the past two years
- Disciplined cost controls and effective management resulted in a strong two-year operating margin of 19%
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
At $3,036 per share, AutoZone trades at 18.4x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
Incyte (INCY)
Trailing 12-Month GAAP Operating Margin: 30%
Founded in 1991 and evolving from a genomics research firm to a commercial-stage drug developer, Incyte (NASDAQ: INCY) is a biopharmaceutical company that discovers, develops, and commercializes proprietary therapeutics for cancer and inflammatory diseases.
Why Are We Fans of INCY?
- Impressive 19.3% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Share buybacks catapulted its annual earnings per share growth to 19.4%, which outperformed its revenue gains over the last five years
- Free cash flow margin increased by 7.9 percentage points over the last five years, giving the company more capital to invest or return to shareholders
Incyte is trading at $97.50 per share, or 3.5x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free.
Affiliated Managers Group (AMG)
Trailing 12-Month GAAP Operating Margin: 19.3%
Using a partnership approach that preserves entrepreneurial culture at its portfolio companies, Affiliated Managers Group (NYSE: AMG) is an investment firm that acquires stakes in boutique asset management companies while allowing them to maintain operational independence.
Why Are We Positive on AMG?
- 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
Affiliated Managers Group’s stock price of $308.37 implies a valuation ratio of 8.5x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
