Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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.
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 generate reliable profits without sacrificing growth and one that may face some trouble.
One Stock to Sell:
Tennant (TNC)
Trailing 12-Month GAAP Operating Margin: 4.9%
As the world’s largest manufacturer of autonomous mobile robots, Tennant (NYSE: TNC) designs, manufactures, and sells cleaning products to various sectors.
Why Do We Avoid TNC?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 1.5% annually over the last two years
- Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable
- Diminishing returns on capital suggest its earlier profit pools are drying up
Tennant’s stock price of $86.12 implies a valuation ratio of 15.3x forward P/E. To fully understand why you should be careful with TNC, check out our full research report (it’s free).
Two Stocks to Buy:
Cintas (CTAS)
Trailing 12-Month GAAP Operating Margin: 23%
Starting as a family business collecting and cleaning shop rags in Cincinnati, Cintas (NASDAQ: CTAS) provides corporate identity uniforms, facility services, and safety products to over one million businesses across North America.
What Makes CTAS Stand Out?
- Annual revenue growth of 9.8% over the past five years was outstanding, reflecting market share gains this cycle
- Share repurchases over the last five years enabled its annual earnings per share growth of 16.4% to outpace its revenue gains
- CTAS is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Cintas is trading at $173.53 per share, or 32.1x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Marsh (MRSH)
Trailing 12-Month GAAP Operating Margin: 21.7%
With roots dating back to 1871 and a presence in over 130 countries, Marsh (NYSE: MRSH) is a global professional services firm that helps organizations manage risk, strategy, and workforce challenges through its four specialized businesses.
Why Is MRSH a Good Business?
- Market share has increased this cycle as its 9.3% annual revenue growth over the last five years was exceptional
- Massive revenue base of $27.52 billion makes it a well-known name that influences purchasing decisions
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends, and its improved cash conversion implies it’s becoming a less capital-intensive business
At $172.12 per share, Marsh trades at 15.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
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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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
