1 Profitable Stock for Long-Term Investors, and 2 We’d Brush Aside
Profitability is a prerequisite for any serious investment, but it isn’t a promise. A company can be profitable today and still lose its edge tomorrow if it relies too heavily on pricing power or cost controls. As Jeff Bezos famously said, “Your margin is my opportunity.” In other words, high margins attract competition — and that’s exactly when long-term investors need to pay attention.
That’s the idea behind this week’s StockStory screen. We combed through our coverage list looking for companies that aren’t just profitable, but have the growth to stay that way. We found one we think is worth owning for the long haul, along with two profitable names we’d leave off the list.
The One We’d Own: Alignment Healthcare (NASDAQ: ALHC)
Founded in 2013 with the mission of modernizing healthcare for seniors, Alignment Healthcare provides Medicare Advantage plans that bundle concierge services, transportation benefits, and technology-driven care coordination. Its trailing 12-month GAAP operating margin is just 1.2%, which tells you this isn’t a high-margin business yet. But that thin margin is partly a function of scale — the company is still investing in growth and building its membership base.
At $13.53 per share, ALHC trades at 21.3x forward earnings. That’s not a cheap entrance even for a healthcare insurer. But for investors looking out a decade or more, the real opportunity is operating leverage: if membership keeps growing and costs scale from here, today’s valuation could look far more reasonable down the road. The margin cushion is thin, so execution matters. But we think the long-term setup is favorable.
The One We’d Brush Aside: The Cheesecake Factory (NASDAQ: CAKE)
There’s a lot to like about The Cheesecake Factory. The free brown bread, the oversized portions, and the legendary dessert menu have made it a staple of American casual dining. But in a segment where consumer spending and foot traffic drive everything, a 5.3% trailing GAAP operating margin leaves limited room for error.
At $116.80 per share, CAKE trades at 24.5x forward earnings. That’s a heavy multiple for a mature restaurant brand facing higher labor costs, more competition, and shifting consumer habits. Profitability isn’t the question. Durability is. If margins come under pressure, the stock doesn’t have much valuation support. We’d think twice before putting this one in a long-term portfolio.
The Other One We’d Brush Aside: Halliburton (NYSE: HAL)
Halliburton operates at the center of the global energy complex, providing drilling, completion, and production services for oil and gas companies around the world. Its trailing 12-month operating margin of 11.4% is respectable, and the stock trades at $33.50 per share, or 13.2x forward earnings. On the surface, that looks like a reasonable valuation.
But in energy, today’s margins can be misleading. The business is tied to commodity prices, upstream capital spending, and geopolitical swings that sit well outside management’s control. A cheap multiple can get cheaper if oil sentiment turns or customers pull back on spending. Halliburton’s competitive position remains strong, but its earnings power is cyclical. For long-term investors, that’s an important distinction — and a reason we’d leave HAL off the watchlist.
While You’re Here: Top 9 Market-Beating Stocks. The best companies don’t just beat the market once. They do it again and again — with rising revenue, growing free cash flow, and returns on capital that leave the competition behind. The market has already rewarded many of these names, but we think the story isn’t over.
See which 9 stocks made this week’s list. It’s free. Get Our Top 9 Market-Beating Stocks for Free HERE.
Stocks that made our list in 2020 include now-familiar names such as Nvidia, which climbed more than 1,460% between June 2020 and June 2025, as well as under-the-radar businesses like Exlservice, which gained 271% over the same stretch. Your next long-term winner could already be in the screen.