2 Profitable Stocks Worth Investigating and 1 Facing Challenges

Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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 balance growth and profitability and one best left off your watchlist.

One Stock to Sell:

Omnicell (OMCL)

Trailing 12-Month GAAP Operating Margin: 1.3%

Driven by the vision of an "Autonomous Pharmacy" with zero medication errors, Omnicell (NASDAQ:OMCL) provides medication management automation and adherence tools that help healthcare systems and pharmacies reduce errors and improve efficiency.

Why Is OMCL Risky?

1. Annual sales declines of 3.5% for the past two years show its products and services struggled to connect with the market during this cycle
2. Earnings per share fell by 6.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
3. Free cash flow margin dropped by 13.1 percentage points over the last five years, implying the company became more capital intensive as competition picked up

At $33.80 per share, Omnicell trades at 23.3x forward P/E. Check out our free in-depth research report to learn more about why OMCL doesn’t pass our bar.

Two Stocks to Watch:

AutoZone (AZO)

Trailing 12-Month GAAP Operating Margin: 19.6%

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 Good Business?

1. Same-store sales growth lends it the confidence to gradually expand its store base so it can reach more customers
2. Differentiated product assortment leads to a best-in-class gross margin of 51.8%
3. Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends

AutoZone’s stock price of $4,111 implies a valuation ratio of 24.8x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

CACI (CACI)

Trailing 12-Month GAAP Operating Margin: 8.9%

Founded to commercialize SIMSCRIPT, CACI International (NYSE:CACI) offers defense, intelligence, and IT solutions to support national security and government transformation efforts.

Why Are We Positive On CACI?

1. Demand is greater than supply as the company’s 11.6% average backlog growth over the past two years shows it’s securing new contracts and accumulating more orders than it can fulfill
2. Projected revenue growth of 8.3% for the next 12 months suggests its momentum from the last two years will persist
3. Share repurchases over the last two years enabled its annual earnings per share growth of 18.6% to outpace its revenue gains

CACI is trading at $481.42 per share, or 17.6x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

High-Quality Stocks for All Market Conditions

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check 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-micro-cap company Kadant (+351% 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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