Business services providers play a critical role for enterprises, assisting them with everything from new hardware integrations to consulting and marketing. But cutbacks in corporate spending and the threat of new AI products have kept sentiment in check, and over the past six months, the industry’s return was flat while the S&P 500 climbed by 7.1%.

Investors should tread carefully as many of these companies are also cyclical, and any misstep can have you catching a falling knife. Keeping that in mind, here are three services stocks best left ignored.

Pitney Bowes (PBI)

Market Cap: $2.00 billion

With a century-long history dating back to 1920 and processing over 15 billion pieces of mail annually, Pitney Bowes (NYSE: PBI) provides shipping, mailing technology, logistics, and financial services to businesses of all sizes.

Why Does PBI Fall Short?

1. Annual sales declines of 9% for the past five years show its products and services struggled to connect with the market during this cycle
2. Low free cash flow margin of 3.4% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
3. Underwhelming 9.4% return on capital reflects management’s difficulties in finding profitable growth opportunities

Pitney Bowes trades at a stock price of $11.02. Read our free research report to see why you should think twice about including PBI in your portfolio.

Dun & Bradstreet (DNB)

Market Cap: $4.07 billion

Known for its proprietary D-U-N-S Number that serves as a unique identifier for businesses worldwide, Dun & Bradstreet (NYSE: DNB) provides business decisioning data and analytics that help companies evaluate credit risks, verify suppliers, enhance sales productivity, and gain market visibility.

Why Do We Pass on DNB?

1. Sales trends were unexciting over the last two years as its 3.7% annual growth was below the typical business services company
2. Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 5 percentage points
3. Earnings per share were flat over the last four years and fell short of the peer group average

Dun & Bradstreet is trading at $9.11 per share, or 8.5x forward P/E. To fully understand why you should be careful with DNB, check out our full research report (it’s free).

TaskUs (TASK)

Market Cap: $1.50 billion

Starting as a virtual assistant service in 2008 before evolving into a global digital services provider, TaskUs (NASDAQ: TASK) provides outsourced digital services including customer experience management, content moderation, and AI data services to innovative technology companies.

Why Do We Think Twice About TASK?

1. Sales trends were unexciting over the last two years as its 1.8% annual growth was below the typical business services company
2. Earnings per share have dipped by 4% annually over the past two years, which is concerning because stock prices follow EPS over the long term
3. ROIC of 5.4% reflects management’s challenges in identifying attractive investment opportunities

TaskUs’s stock price of $17.19 implies a valuation ratio of 12.1x forward P/E. Check out our free in-depth research report to learn more about why TASK doesn’t pass our bar.

Stocks We Like More

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum 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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