Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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.
Not all profitable companies are created equal, and that’s why we built StockStory - to help you find the ones that truly shine bright. That said, here is one profitable company that leverages its financial strength to beat the competition and two best left off your watchlist.
Two Stocks to Sell:
Dave & Buster's (PLAY)
Trailing 12-Month GAAP Operating Margin: 6.8%
Founded by a former game parlor and bar operator, Dave & Buster’s (NASDAQ: PLAY) operates a chain of arcades providing immersive entertainment experiences.
Why Is PLAY Risky?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
- Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders
At $16.97 per share, Dave & Buster's trades at 21.4x forward P/E. To fully understand why you should be careful with PLAY, check out our full research report (it’s free for active Edge members).
UFP Technologies (UFPT)
Trailing 12-Month GAAP Operating Margin: 16%
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 Does UFPT Worry Us?
- Smaller revenue base of $598 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Estimated sales growth of 4.6% for the next 12 months implies demand will slow from its two-year trend
UFP Technologies is trading at $237.23 per share, or 22.1x forward P/E. Dive into our free research report to see why there are better opportunities than UFPT.
One Stock to Watch:
Corpay (CPAY)
Trailing 12-Month GAAP Operating Margin: 44.5%
Formerly known as FLEETCOR until its 2024 rebrand, Corpay (NYSE: CPAY) provides specialized payment solutions for businesses to manage vehicle expenses, corporate payments, and lodging costs with enhanced control and reporting capabilities.
Why Are We Fans of CPAY?
- Solid 11.8% annual revenue growth over the last five years indicates its offering’s solve complex business issues
- Share buybacks lifted its annual earnings per share growth to 13%, which outperformed its revenue gains over the last five years
- Industry-leading 31.1% return on equity demonstrates management’s skill in finding high-return investments
Corpay’s stock price of $308.64 implies a valuation ratio of 12.5x 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
Check out the high-quality names we’ve flagged in 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 244% over the last five years (as of June 30, 2025).
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 Kadant (+351% 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.