2 Profitable Stocks to Consider Right Now and 1 to Turn Down

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 leverage their financial strength to beat the competition and one that may struggle to keep up.

One Stock to Sell:

Benchmark (BHE)

Trailing 12-Month GAAP Operating Margin: 4.2%

Operating as a critical behind-the-scenes partner for complex technology products since 1979, Benchmark Electronics (NYSE:BHE) provides advanced manufacturing, engineering, and technology solutions for original equipment manufacturers across aerospace, medical, industrial, and technology sectors.

Why Does BHE Give Us Pause?

1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 5.8% annually over the last two years
2. Poor free cash flow margin of 1% for the last five years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
3. Below-average returns on capital indicate management struggled to find compelling investment opportunities

Benchmark is trading at $36.52 per share, or 14.1x forward P/E. Dive into our free research report to see why there are better opportunities than BHE.

Two Stocks to Watch:

Airbnb (ABNB)

Trailing 12-Month GAAP Operating Margin: 22.2%

Founded by Brian Chesky and Joe Gebbia in their San Francisco apartment, Airbnb (NASDAQ:ABNB) is the world’s largest online marketplace for lodging, primarily homestays.

Why Are We Backing ABNB?

1. Nights and Experiences Booked have grown by 10.4% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
2. Earnings per share grew by 49.4% annually over the last three years, massively outpacing its peers
3. Strong free cash flow margin of 39.7% enables it to reinvest or return capital consistently

At $128.80 per share, Airbnb trades at 19.1x forward EV/EBITDA. Is now the right time to buy? Find out in our full research report, it’s free.

Bentley (BSY)

Trailing 12-Month GAAP Operating Margin: 23.5%

Founded by brothers Keith and Barry Bentley, Bentley Systems (NASDAQ:BSY) offers a software-as-a-service platform that addresses the lifecycle of infrastructure projects such as road networks, tunnel systems, and wastewater facilities.

Why Could BSY Be a Winner?

1. 109% net revenue retention rate indicates success in expanding revenue within existing accounts
2. Software platform has product-market fit given the rapid recovery of its customer acquisition costs
3. Robust free cash flow margin of 31.5% gives it many options for capital deployment

Bentley’s stock price of $47.73 implies a valuation ratio of 10.5x forward price-to-sales. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.