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".
A business making money today isn’t necessarily a winner, which is why we analyze companies across multiple dimensions at StockStory. Keeping that in mind, here is one profitable company that leverages its financial strength to beat the competition and two that may face some trouble.
Two Stocks to Sell:
WillScot Mobile Mini (WSC)
Trailing 12-Month GAAP Operating Margin: 23.3%
Originally focusing on mobile offices for construction sites, WillScot (NASDAQ: WSC) provides ready-to-use temporary spaces, largely for longer-term lease.
Why Are We Cautious About WSC?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
- Forecasted revenue decline of 4.9% for the upcoming 12 months implies demand will fall off a cliff
- Earnings per share have dipped by 12.5% annually over the past two years, which is concerning because stock prices follow EPS over the long term
WillScot Mobile Mini is trading at $18.00 per share, or 14.4x forward P/E. If you’re considering WSC for your portfolio, see our FREE research report to learn more.
American Woodmark (AMWD)
Trailing 12-Month GAAP Operating Margin: 6.9%
Starting as a small millwork shop, American Woodmark (NASDAQ: AMWD) is a cabinet manufacturing company that helps customers from inspiration to installation.
Why Should You Sell AMWD?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 9.6% annually over the last two years
- Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
- Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
At $54.47 per share, American Woodmark trades at 11.8x forward P/E. Dive into our free research report to see why there are better opportunities than AMWD.
One Stock to Buy:
SoFi (SOFI)
Trailing 12-Month GAAP Operating Margin: 12.1%
Starting as a student loan refinancing company founded by Stanford business school students in 2011, SoFi Technologies (NASDAQ: SOFI) operates a digital financial platform offering lending, banking, investing, and other financial services to help members borrow, save, spend, invest, and protect their money.
Why Is SOFI a Top Pick?
- Annual revenue growth of 30.1% over the last two years was superb and indicates its market share increased during this cycle
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 92.5% outpaced its revenue gains
SoFi’s stock price of $30.50 implies a valuation ratio of 54.8x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out 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 183% over the last five years (as of March 31st 2025).
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