2 Profitable Stocks for Long-Term Investors and 1 We Turn Down

Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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.

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

Tractor Supply (TSCO)

Trailing 12-Month GAAP Operating Margin: 9.3%

Started as a mail-order tractor parts business, Tractor Supply (NASDAQ:TSCO) is a retailer of general goods such as agricultural supplies, hardware, and pet food for the rural consumer.

Why Does TSCO Fall Short?

1. Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 2.6% for the last three years
2. Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
3. Gross margin of 36.4% is below its competitors, leaving less money for marketing and promotions

Tractor Supply is trading at $31.40 per share, or 14.2x forward P/E. To fully understand why you should be careful with TSCO, check out our full research report (it’s free).

Two Stocks to Watch:

QuinStreet (QNST)

Trailing 12-Month GAAP Operating Margin: 1.7%

Founded during the dot-com era in 1999 and specializing in high-intent consumer traffic, QuinStreet (NASDAQ:QNST) operates digital performance marketplaces that connect clients in financial and home services with consumers actively searching for their products.

Why Will QNST Outperform?

1. Market share has increased this cycle as its 47.2% annual revenue growth over the last two years was exceptional
2. Additional sales over the last two years increased its profitability as the 628% annual growth in its earnings per share outpaced its revenue
3. Returns on capital are increasing as management’s prior bets are starting to bear fruit

At $12.44 per share, QuinStreet trades at 8.2x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Aramark (ARMK)

Trailing 12-Month GAAP Operating Margin: 4.3%

From serving hot dogs at major league stadiums to managing college dining halls that feed thousands daily, Aramark (NYSE:ARMK) provides food services and facilities management to schools, healthcare facilities, businesses, sports venues, and correctional institutions across 16 countries.

Why Are We Fans of ARMK?

1. Market share has increased this cycle as its 13.3% annual revenue growth over the last five years was exceptional
2. Dominant market position is represented by its $19.41 billion in revenue and gives it fixed cost leverage when sales grow
3. Incremental sales over the last five years have been highly profitable as its earnings per share increased by 26.5% annually, topping its revenue gains

Aramark’s stock price of $52.96 implies a valuation ratio of 21.7x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.

High-Quality Stocks for All Market Conditions

ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.

Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum 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 Kadant (+351% five-year return). Find your next big winner with StockStory today.