8 Profit-Machine Stocks Boasting 75%+ Gross Margins

High gross margins are often a sign of strong pricing power, efficient cost structures and differentiated products or services.

When a company sustains gross margins above 75%, it usually reflects a business model with limited competitive pressure or high-value offerings that command premium pricing.

For investors, these companies can be attractive because high gross margins often translate into stronger profitability and more flexibility to invest in growth or withstand market shifts.

Here are 8 stocks with businesses that stand out for the strength of their underlying economics.

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Here are 3 stocks from this list that analysts think are the most undervalued today:

Salesforce (CRM)

Salesforce (CRM) is a leading enterprise software company specializing in cloud-based customer relationship management (CRM) solutions. Its platform supports sales, service, marketing, analytics, and application development for clients across industries.

Over the last five years, Salesforce has generated average annual revenue growth of approximately 17%, driven by expanding subscription-based contracts and cross-selling across its product ecosystem. However, recent year-over-year revenue growth has moderated to the high single digits (e.g., 8.7% in FY2025).

The company’s latest trailing twelve months (TTM) Return on Equity (ROE) is approximately 11%, reflecting strong net income generation and ongoing investment in product development and integration of acquired businesses.

In a significant shift, the company recently initiated a quarterly cash dividend and continues to utilize selective share repurchases to return capital to shareholders, alongside reinvesting cash flow into innovation. With a strong recurring revenue model and a broad enterprise customer base, Salesforce continues to benefit from long-term demand for digital transformation and cloud adoption, particularly in the growing domain of enterprise AI.

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Adobe (ADBE)

Adobe (ADBE) is a leading software company best known for its Creative Cloud suite, which includes Photoshop, Illustrator, Premiere Pro, and Acrobat. The company has successfully transitioned to a subscription-based model, generating stable recurring revenue from creative professionals, enterprises, and digital marketers.

Over the last five fiscal years (FY2020-FY2024), Adobe has recorded average annual revenue growth of approximately 14%, although the more recent growth rates have moderated to around 11%, supported by strong demand for content creation, digital document management, and marketing analytics solutions. Its 3-year average return on equity (ROE) is approximately 35%, highlighting significant profitability and efficient use of capital.

Adobe does not issue dividends, instead allocating cash toward research and development, acquisitions, and stock repurchases. With leading market positions in digital media and digital experience software, the company continues to benefit from the growing need for content creation and digital transformation, particularly with its focus on AI-driven solutions.

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Intuit (INTU)

Intuit (INTU) is a financial technology (FinTech) platform company renowned for its core products: TurboTax (consumer tax preparation), QuickBooks (cloud-based small business accounting), Credit Karma (personal finance), and Mailchimp (email marketing and automation). The company operates on a model primarily driven by subscription-based services and seasonal tax revenue.

Intuit has maintained strong double-digit growth, reporting a total revenue increase of 16% for the most recent full fiscal year (FY2025). This growth is primarily fueled by the accelerating adoption of its Online Ecosystem offerings, particularly in QuickBooks Online and the shift toward assisted tax filing with TurboTax Live.

The company exhibits solid and improving profitability, with its latest trailing twelve months (TTM) Return on Equity (ROE) standing at approximately 17%. Intuit’s strategy balances shareholder returns with reinvestment, maintaining a dividend payout ratio of approximately 31% and providing a current dividend yield of about 0.75%.

Leveraging its comprehensive platform and investing heavily in AI-driven experiences to automate complex tasks, Intuit remains exceptionally well positioned to capitalize on the secular trends of small business cloud migration and digital transformation in personal finance and compliance.

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Wall Street Analysts Are Bullish on These 5 Undervalued Compounders With Market-Beating Potential

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Inside, you’ll get a breakdown of 5 high-quality businesses with:

• Strong revenue growth and durable competitive advantages
• Attractive valuations based on forward earnings and expected earnings growth
• Long-term upside potential backed by analyst forecasts and TIKR’s valuation models

These are the kinds of stocks that can deliver massive long-term returns, especially if you catch them while they’re still trading at a discount.

Whether you’re a long-term investor or just looking for great businesses trading below fair value, this report will help you zero in on high-upside opportunities.

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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!