Even if a company is profitable, it doesn’t always mean it’s a great investment. Some struggle to maintain growth, face looming threats, or fail to reinvest wisely, limiting their future potential.
A business making money today isn’t necessarily a winner, which is why we analyze companies across multiple dimensions at StockStory. That said, here is one profitable company that balances growth and profitability and two best left off your watchlist.
Two Stocks to Sell:
Carnival (CCL)
Trailing 12-Month GAAP Operating Margin: 16.2%
Boasting outrageous amenities like a planetarium on board its ships, Carnival (NYSE:CCL) is one of the world's largest leisure travel companies and a prominent player in the cruise industry.
Why Does CCL Give Us Pause?
- Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 9% over the last five years was below our standards for the consumer discretionary sector
- Estimated sales growth of 4.1% for the next 12 months implies demand will slow from its two-year trend
- Negative returns on capital show management lost money while trying to expand the business
Carnival is trading at $31.92 per share, or 16x forward P/E. Dive into our free research report to see why there are better opportunities than CCL.
Great Lakes Dredge & Dock (GLDD)
Trailing 12-Month GAAP Operating Margin: 13.3%
Founded as Lydon & Drews dredging company, Great Lakes Dredge & Dock (NASDAQ:GLDD) provides dredging services, land reclamation, and coastal protection projects in the United States and internationally.
Why Does GLDD Fall Short?
- Annual revenue growth of 2.9% over the last five years was below our standards for the industrials sector
- Estimated sales decline of 1.3% for the next 12 months implies a challenging demand environment
- Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
At $11.61 per share, Great Lakes Dredge & Dock trades at 14.7x forward P/E. If you’re considering GLDD for your portfolio, see our FREE research report to learn more.
One Stock to Buy:
Lam Research (LRCX)
Trailing 12-Month GAAP Operating Margin: 32%
Founded in 1980 by David Lam, the man who pioneered semiconductor etching technology, Lam Research (NASDAQ:LRCX) is one of the leading providers of wafer fabrication equipment used to make semiconductors.
Why Should You Buy LRCX?
- Impressive 12.9% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Excellent operating margin of 30.5% highlights the efficiency of its business model, and its profits increased over the last five years as it scaled
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
Lam Research’s stock price of $100.05 implies a valuation ratio of 24.8x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. 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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