Some of the most critical questions any investor can ask before buying a stock center on its profit margin. As a rough rule of thumb, it's usually a good idea to look at stocks with rising margins and avoid those with margins in decline.

Let's find out why by looking at two market-beating stocks. Illinois Tool Works (NYSE: ITW) and Honeywell International (NASDAQ: HON) have increased more than 250% over the last decade compared to the S&P 500's increase of 183%.

The first benefit is somewhat obvious, but the second might come as a surprise. They both relate to margins and their impact on valuation. 

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Source Fool.com