Doximity: A Quiet Compounding

Medical Illustration

The market, you see, had a bit of a fit recently. Software stocks, generally, were tossed about like flotsam, all because of this new worry about artificial intelligence. People feared machines would steal their jobs, or worse, write better poetry. So it goes.

Amidst the wreckage, there’s this company, Doximity (DOCS +1.27%). It’s a social network, of all things, but for doctors. Not for cat videos or political arguments, but for actual medical information. The stock has lost a good chunk of its value – about 66% in the last year. A shame, really, but also, potentially, an opportunity. It’s down near an all-time low, and a fellow can’t help but wonder if the baby’s been thrown out with the bathwater.

They say a wise man looks for value where others see only fear. And this, my friends, might just be a place to look.

A Digital Water Cooler for Doctors

Doximity started as a way for doctors to connect, share information, and generally not feel so alone in a world full of sick people. It’s a network where they can discuss cases, read medical journals, and, crucially, learn about new drugs. And that, naturally, is where the money comes in.

Pharmaceutical companies pay Doximity to get their information in front of doctors. It’s advertising, really, but dressed up as medical education. And it works. 126 customers are spending over half a million dollars a year on the platform. A lot of money. Roughly 85% of all doctors in the U.S. use it. Not bad for a company most people have never heard of. There’s very little competition, which is a comforting thought in a chaotic world.

Now, they’re dabbling in AI – DoxGPT, they call it. Another tool for doctors, supposedly. It’s mostly just adding to the time doctors spend on the platform right now. But it could be something more down the road. More revenue, more stability. It’s a long game, of course. Everything is.

Is This a Stock to Hold?

Revenue has been growing nicely, up 448% since March 2020. It’s slowed down a bit recently, to 10% year-over-year, but that’s to be expected. The company still has plenty of room to grow. Drug companies will always need to reach doctors. It’s a fundamental truth. And Doximity provides a direct line to them.

What’s particularly interesting is the company’s profit margin. Earnings before interest and taxes are at 38.5%. That’s exceptionally good for a software provider. They’re doing something right. And they’re only bringing in about $638 million in revenue. There’s potential for significant scaling.

At a price-to-earnings ratio of just 21, Doximity looks reasonably priced. It’s not a screaming buy, but it’s not a bad place to park some capital, especially if you’re looking for a bit of stability in a world gone mad. It’s a quiet compounder, a company that grows steadily, year after year. It won’t make you rich overnight, but it might just provide a comfortable retirement. And in the grand scheme of things, isn’t that all anyone really wants? So it goes.

2026-02-23 09:22

A Digital Water Cooler for Doctors

Is This a Stock to Hold?

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