While profitability is essential, it doesn’t guarantee long-term success. Some companies that rest on their margins will lose ground as competition intensifies - as Jeff Bezos said, "Your margin is my opportunity".

Profits are valuable, but they’re not everything. At StockStory, we help you identify the companies that have real staying power. Keeping that in mind, here is one profitable company that generates reliable profits without sacrificing growth and two best left off your watchlist.

Two Stocks to Sell:

DocuSign (DOCU)

Trailing 12-Month GAAP Operating Margin: 7.9%

Creating the digital equivalent of "sign on the dotted line" for over a billion users worldwide, DocuSign (NASDAQ: DOCU) provides an agreement management platform that enables businesses to electronically prepare, sign, and manage documents and contracts.

Why Are We Wary of DOCU?

1. Customers were hesitant to make long-term commitments to its software as its 8.3% average ARR growth over the last year was sluggish
2. Projected sales growth of 6.6% for the next 12 months suggests sluggish demand
3. Operating profits increased over the last year as the company gained some leverage on its fixed costs and became more efficient

At $69.25 per share, DocuSign trades at 4.6x forward price-to-sales. Check out our free in-depth research report to learn more about why DOCU doesn’t pass our bar.

Hologic (HOLX)

Trailing 12-Month GAAP Operating Margin: 17.5%

As a pioneer in 3D mammography technology that has revolutionized breast cancer detection, Hologic (NASDAQ: HOLX) develops and manufactures diagnostic products, medical imaging systems, and surgical devices focused primarily on women's health and wellness.

Why Are We Hesitant About HOLX?

1. Underwhelming constant currency revenue performance over the past two years suggests its product offering at current prices doesn’t resonate with customers
2. Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 23.6 percentage points
3. Eroding returns on capital suggest its historical profit centers are aging

Hologic’s stock price of $67.86 implies a valuation ratio of 15.6x forward P/E. Read our free research report to see why you should think twice about including HOLX in your portfolio.

One Stock to Watch:

CBIZ (CBZ)

Trailing 12-Month GAAP Operating Margin: 11.2%

With over 120 offices across 33 states and a team of more than 6,700 professionals, CBIZ (NYSE: CBZ) provides accounting, tax, benefits, insurance brokerage, and advisory services to help small and mid-sized businesses manage their finances and operations.

Why Are We Fans of CBZ?

1. Annual revenue growth of 26.6% over the last two years was superb and indicates its market share increased during this cycle
2. Notable projected revenue growth of 20.1% for the next 12 months hints at market share gains
3. Earnings per share have massively outperformed its peers over the last two years, increasing by 29.6% annually

CBIZ is trading at $54.08 per share, or 15.1x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free for active Edge members .

Stocks We Like Even More

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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