1 Profitable Stock with Exciting Potential and 2 We Brush Off
Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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. Keeping that in mind, here is one profitable company that balances growth and profitability and two best left off your watchlist.
Two Business Services Stocks to Sell:
Pitney Bowes (PBI)
Trailing 12-Month GAAP Operating Margin: 22.6%
With a century-long history dating back to 1920 and processing over 15 billion pieces of mail annually, Pitney Bowes (NYSE:PBI) provides shipping, mailing technology, logistics, and financial services to businesses of all sizes.
Why Is PBI Not Exciting?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 13% annually over the last five years
- Projected sales decline of 1.7% over the next 12 months indicates demand will continue deteriorating
Pitney Bowes’s stock price of $16.39 implies a valuation ratio of 9.7x forward P/E. Dive into our free research report to see why there are better opportunities than PBI.
Ingram Micro (INGM)
Trailing 12-Month GAAP Operating Margin: 1.8%
Operating as the crucial link in the global technology supply chain with a presence in 57 countries, Ingram Micro (NYSE:INGM) is a global technology distributor that connects manufacturers with resellers, providing hardware, software, cloud services, and logistics expertise.
Why Are We Wary of INGM?
- Sales were flat over the last five years, indicating it’s failed to expand this cycle
- Earnings growth underperformed the sector average over the last four years as its EPS grew by just 3.4% annually
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 0% for the last five years
Ingram Micro is trading at $26.47 per share, or 7.7x forward P/E. To fully understand why you should be careful with INGM, check out our full research report (it’s free).
One Business Services Stock to Buy:
Hewlett Packard Enterprise (HPE)
Trailing 12-Month GAAP Operating Margin: 6.2%
Born from the 2015 split of the iconic Silicon Valley pioneer Hewlett-Packard, Hewlett Packard Enterprise (NYSE:HPE) provides edge-to-cloud technology solutions that help businesses capture, analyze, and act upon their data across hybrid IT environments.
Why Are We Bullish on HPE?
- ARR growth averaged 48.5% over the past two years, showing customers are willing to take multi-year bets on its offerings
- Unparalleled revenue scale of $41.87 billion gives it an edge in distribution
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 28.5% over the last two years outstripped its revenue performance
At $62.68 per share, Hewlett Packard Enterprise trades at 13.8x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.