Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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.
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 generates reliable profits without sacrificing growth and two that may face some trouble.
Two Stocks to Sell:
Revolve (RVLV)
Trailing 12-Month GAAP Operating Margin: 4.9%
Launched in 2003 by software engineers Michael Mente and Mike Karanikolas, Revolve (NASDAQ:RVLV) is a fashion retailer leveraging social media and a community of fashion influencers to drive its merchandising strategy.
Why Should You Sell RVLV?
- May need to improve its platform and marketing strategy as its 7.4% average growth in active customers underwhelmed
- Key performance metrics have been flashing red recently as its average revenue per buyer dropped by 4% annually while engagement was weak
- Incremental sales over the last three years were much less profitable as its earnings per share fell by 18.5% annually while its revenue grew
Revolve’s stock price of $21.23 implies a valuation ratio of 19.6x forward EV/EBITDA. If you’re considering RVLV for your portfolio, see our FREE research report to learn more.
UFP Technologies (UFPT)
Trailing 12-Month GAAP Operating Margin: 16.8%
With expertise dating back to 1963 in specialized materials and precision manufacturing, UFP Technologies (NASDAQ:UFPT) designs and manufactures custom solutions for medical devices, sterile packaging, and other highly engineered products for healthcare and industrial applications.
Why Are We Wary of UFPT?
- Revenue base of $547.6 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale
At $240.25 per share, UFP Technologies trades at 26.4x forward P/E. Read our free research report to see why you should think twice about including UFPT in your portfolio.
One Stock to Watch:
Match Group (MTCH)
Trailing 12-Month GAAP Operating Margin: 23.5%
Originally started as a dial-up service before widespread internet adoption, Match (NASDAQ:MTCH) was an early innovator in online dating and today has a portfolio of apps including Tinder, Hinge, Archer, and OkCupid.
Why Could MTCH Be a Winner?
- Monetization efforts are paying off as its average revenue per user has grown by 9.5% annually over the last two years
- Share buybacks catapulted its annual earnings per share growth to 28%, which outperformed its revenue gains over the last three years
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
Match Group is trading at $30.21 per share, or 6.5x forward EV/EBITDA. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio 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).
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