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 generate reliable profits without sacrificing growth and one best left off your watchlist.

One Stock to Sell:

Autodesk (ADSK)

Trailing 12-Month GAAP Operating Margin: 22%

Starting with AutoCAD in the 1980s and evolving into a comprehensive design ecosystem, Autodesk (NASDAQ: ADSK) provides software solutions for architecture, engineering, construction, manufacturing, and entertainment industries to design, simulate, and visualize projects.

Why Does ADSK Give Us Pause?

1. Revenue increased by 13.5% annually over the last five years, acceptable on an absolute basis but tepid for a software company enjoying secular tailwinds
2. Competitive market means the company must spend more on sales and marketing to stand out even if the return on investment is low
3. Operating margin failed to increase over the last year, indicating the company couldn’t optimize its expenses

Autodesk is trading at $228.87 per share, or 6.4x forward price-to-sales. Check out our free in-depth research report to learn more about why ADSK doesn’t pass our bar.

Two Stocks to Watch:

Ross Stores (ROST)

Trailing 12-Month GAAP Operating Margin: 11.9%

Selling excess inventory or overstocked items from other retailers, Ross Stores (NASDAQ: ROST) is an off-price concept that sells apparel and other goods at prices much lower than department stores.

Why Are We Positive On ROST?

1. Aggressive strategy of rolling out new stores to gobble up whitespace is prudent given its same-store sales growth
2. Brick-and-mortar locations are witnessing elevated demand as their same-store sales growth averaged 3.4% over the past two years
3. Industry-leading 30.6% return on capital demonstrates management’s skill in finding high-return investments

Ross Stores’s stock price of $200.37 implies a valuation ratio of 28.6x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Nextpower (NXT)

Trailing 12-Month GAAP Operating Margin: 20.5%

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 Good Business?

1. Impressive 25.7% annual revenue growth over the last two years indicates it’s winning market share this cycle
2. Free cash flow margin grew by 22.5 percentage points over the last five years, giving the company more chips to play with
3. Improving returns on capital reflect management’s ability to monetize investments

At $116.92 per share, Nextpower trades at 27.9x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.

The names generating the next wave of massive growth are right here in our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

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 Exlservice (+354% five-year return). Find your next big winner with StockStory today.