2 Profitable Stocks to Consider Right Now and 1 Facing Headwinds

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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. Keeping that in mind, here are two profitable companies that balance growth and profitability and one that may face some trouble.

One Stock to Sell:

Veralto (VLTO)

Trailing 12-Month GAAP Operating Margin: 23.3%

Spun off from Danaher in 2023, Veralto (NYSE: VLTO) provides water analytics and treatment solutions.

Why Do We Think VLTO Will Underperform?

  1. Muted 4% annual revenue growth over the last four years shows its demand lagged behind its industrials peers
  2. Projected sales growth of 5.6% for the next 12 months suggests sluggish demand
  3. Earnings per share were flat over the last four years while its revenue grew, showing its incremental sales were less profitable

Veralto’s stock price of $107.67 implies a valuation ratio of 28x forward P/E. Read our free research report to see why you should think twice about including VLTO in your portfolio.

Two Stocks to Watch:

AMD (AMD)

Trailing 12-Month GAAP Operating Margin: 7.7%

Founded in 1969 by a group of former Fairchild semiconductor executives led by Jerry Sanders, Advanced Micro Devices (NASDAQ: AMD) is one of the leading designers of computer processors and graphics chips used in PCs and data centers.

Why Does AMD Stand Out?

  1. Annual revenue growth of 16.3% over the past two years was outstanding, reflecting market share gains this cycle
  2. Market share is on track to rise over the next 12 months as its 22.7% projected revenue growth implies demand will accelerate from its two-year trend
  3. Earnings per share grew by 32% annually over the last five years, comfortably beating the peer group average

AMD is trading at $180.60 per share, or 36x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.

Deckers (DECK)

Trailing 12-Month GAAP Operating Margin: 23.7%

Established in 1973, Deckers (NYSE: DECK) is a footwear and apparel conglomerate with a portfolio of lifestyle and performance brands.

Why Are We Fans of DECK?

  1. Steady constant currency growth over the past two years shows the company can pursue its global ambitions, even in uncertain economic times
  2. Free cash flow margin is expected to increase by 2.3 percentage points next year, suggesting the company will have more capital to invest or return to shareholders
  3. Rising returns on capital show management is finding more attractive investment opportunities

At $104.00 per share, Deckers trades at 17.1x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking out 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 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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