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 generates reliable profits without sacrificing growth and two that may struggle to keep up.

Two Stocks to Sell:

Utz (UTZ)

Trailing 12-Month GAAP Operating Margin: 2.7%

Tracing its roots back to 1921 when Bill and Salie Utz began making potato chips in their kitchen, Utz Brands (NYSE: UTZ) offers salty snacks such as potato chips, tortilla chips, pretzels, cheese snacks, and ready-to-eat popcorn, among others.

Why Should You Sell UTZ?

1. Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
2. Smaller revenue base of $1.43 billion means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
3. ROIC of 0.3% reflects management’s challenges in identifying attractive investment opportunities

Utz’s stock price of $12.40 implies a valuation ratio of 14x forward P/E. Check out our free in-depth research report to learn more about why UTZ doesn’t pass our bar.

ArcBest (ARCB)

Trailing 12-Month GAAP Operating Margin: 5.4%

Historically owning furniture, banking, and other subsidiaries, ArcBest (NASDAQ: ARCB) offers full-truckload, less-than-truckload, and intermodal deliveries of freight.

Why Do We Avoid ARCB?

1. Flat unit sales over the past two years imply it may need to invest in improvements to get back on track
2. Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 28.1% annually, worse than its revenue
3. Diminishing returns on capital suggest its earlier profit pools are drying up

At $71.77 per share, ArcBest trades at 14.2x forward P/E. Dive into our free research report to see why there are better opportunities than ARCB.

One Stock to Buy:

SEI Investments (SEIC)

Trailing 12-Month GAAP Operating Margin: 27%

Founded in 1968 as Simulated Environments Inc. to train bank loan officers using computer simulations, SEI Investments (NASDAQ: SEIC) provides technology platforms, investment management, and operational solutions for financial institutions, wealth managers, and investors.

Why Do We Love SEIC?

1. Products and services resonate with customers, evidenced by its respectable 8.1% annualized sales growth over the last two years
2. Share buybacks catapulted its annual earnings per share growth to 27.5%, which outperformed its revenue gains over the last two years
3. Stellar return on equity showcases management’s ability to surface highly profitable business ventures

SEI Investments is trading at $84.74 per share, or 16.3x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.

Stocks We Like Even More

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 9 Market-Beating Stocks. 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 Comfort Systems (+782% 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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