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Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.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

One Stock to Sell:

Expeditors (EXPD)

Trailing 12-Month GAAP Operating Margin: 9.8%

Expeditors (NYSE:EXPD) offers air and ocean freight as well as brokerage services.

Why Should You Dump EXPD?

1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 21.2% annually over the last two years

2. Earnings per share have contracted by 16.6% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance

3. Waning returns on capital imply its previous profit engines are losing steam

Expeditors’s stock price of $109.61 implies a valuation ratio of 20.3x forward P/E. Dive into our free research report to see why there are better opportunities than EXPD.

Two Stocks to Watch:

AutoZone (AZO)

Trailing 12-Month GAAP Operating Margin: 20.1%

Aiming to be a one-stop shop for the DIY customer, AutoZone (NYSE:AZO) is an auto parts and accessories retailer that sells everything from car batteries to windshield wiper fluid to brake pads.

Why Should AZO Be on Your Watchlist?

1. Same-store sales provide a solid foundation for the steady expansion of its stores

2. Differentiated product assortment is reflected in its best-in-class gross margin of 53%

3. Strong free cash flow margin of 11.1% enables it to reinvest or return capital consistently

At $3,737 per share, AutoZone trades at 23x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.

Badger Meter (BMI)

Trailing 12-Month GAAP Operating Margin: 20%

The developer of the world’s first frost-proof water meter in 1905, Badger Meter (NYSE:BMI) provides water control and measure equipment to various industries.

Why Do We Love BMI?

1. Impressive 20% annual revenue growth over the last two years indicates it’s winning market share this cycle

2. Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 36.6% annually

3. Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends

Badger Meter is trading at $224.22 per share, or 47.7x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.