Growth is oxygen. But when it evaporates, the consequences can be severe - ask anyone who bought Cisco in the Dot-Com Bubble or newer investors who lived through the 2020 to 2022 COVID cycle.
The risks that can come from buying these assets are precisely why we started StockStory — to isolate the long-term winners from the losers so you can invest with confidence. On that note, here is one growth stock expanding its competitive advantage and two whose momentum may slow.
Two Growth Stocks to Sell:
Paychex (PAYX)
One-Year Revenue Growth: +16.9%
Once known as the go-to service for small business payroll needs, Paychex (NASDAQ: PAYX) provides payroll processing, HR services, employee benefits administration, and insurance solutions to small and medium-sized businesses.
Why Are We Wary of PAYX?
- Sales trends were unexciting over the last five years as its 9.9% annual growth was well below the typical software company
- Estimated sales growth of 5.4% for the next 12 months implies demand will slow from its two-year trend
- Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 1.1 percentage points
Paychex’s stock price of $121.54 implies a valuation ratio of 6.4x forward price-to-sales. To fully understand why you should be careful with PAYX, check out our full research report (it’s free).
Guardant Health (GH)
One-Year Revenue Growth: +42.7%
Pioneering the field of "liquid biopsy" with technology that can identify cancer-specific genetic mutations from a simple blood draw, Guardant Health (NASDAQ: GH) develops blood tests that detect and monitor cancer by analyzing tumor DNA in the bloodstream, helping doctors make treatment decisions without invasive biopsies.
Why Are We Cautious About GH?
- Revenue base of $1.18 billion indicates it’s still subscale compared to its larger peers (though this creates opportunities to expand into untapped markets)
- Negative free cash flow raises questions about the return timeline for its investments
- EBITDA losses may force it to accept punitive lending terms or high-cost debt
Guardant Health is trading at $162.50 per share, or 13.8x forward price-to-sales. If you’re considering GH for your portfolio, see our FREE research report to learn more.
One Growth Stock to Buy:
HNI (HNI)
One-Year Revenue Growth: +70.1%
With roots dating back to 1944 and a significant acquisition of Kimball International in 2023, HNI (NYSE: HNI) manufactures and sells office furniture systems, seating, and storage solutions, as well as residential fireplaces and heating products.
Why Do We Love HNI?
- Impressive 29.9% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Projected revenue growth of 40.2% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Earnings growth has easily exceeded the peer group average over the last five years as its EPS has compounded at 10.7% annually
At $49.66 per share, HNI trades at 11.3x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.
