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.

Profits are valuable, but they’re not everything. At StockStory, we help you identify the companies that have real staying power. 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:

Kemper (KMPR)

Trailing 12-Month GAAP Operating Margin: 3.3%

Originally known as Unitrin until rebranding in 2011, Kemper (NYSE: KMPR) is an insurance holding company that provides automobile, homeowners, life, and other insurance products to individuals and businesses across the United States.

Why Do We Avoid KMPR?

1. 1.2% annual declines in net premiums earned for the past five years indicates policy sales struggled this cycle
2. Sales were less profitable over the last five years as its earnings per share fell by 11.7% annually, worse than its revenue declines
3. Annual book value per share declines of 8.1% for the past five years show its capital management struggled during this cycle

Kemper is trading at $29.42 per share, or 0.6x forward P/B. Check out our free in-depth research report to learn more about why KMPR doesn’t pass our bar.

Two Stocks to Buy:

Graham Corporation (GHM)

Trailing 12-Month GAAP Operating Margin: 6.2%

Founded when its founder patented a unique design for a vacuum system used in the sugar refining process, Graham (NYSE: GHM) provides vacuum and heat transfer equipment for the energy, petrochemical, refining, and chemical sectors.

Why Will GHM Outperform?

1. Sales pipeline is in good shape as its backlog averaged 27.8% growth over the past two years
2. Earnings per share grew by 83.3% annually over the last one years, massively outpacing its peers
3. Free cash flow margin expanded by 15.4 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends

At $82.78 per share, Graham Corporation trades at 44.1x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

WisdomTree (WT)

Trailing 12-Month GAAP Operating Margin: 35.3%

Originally founded as a financial media company before pivoting to ETF management in 2006, WisdomTree (NYSE: WT) is a financial services company that creates and manages exchange-traded funds (ETFs) and other investment products for individual and institutional investors.

Why Should You Buy WT?

1. Market share has increased this cycle as its 18.9% annual revenue growth over the last two years was exceptional
2. Share repurchases over the last two years enabled its annual earnings per share growth of 52.5% to outpace its revenue gains
3. Stellar return on equity showcases management’s ability to surface highly profitable business ventures

WisdomTree’s stock price of $14 implies a valuation ratio of 12.7x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

High-Quality Stocks for All Market Conditions

WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.

But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.

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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.