While some companies burn cash to fuel expansion, others struggle to turn spending into sustainable growth. A high cash burn rate without a strong balance sheet can leave investors exposed to significant downside.
Negative cash flow can lead to trouble, but StockStory helps you identify the businesses that stand a chance of making it through. That said, here is one high-risk, high-reward company that could turn today’s losses into tomorrow’s gains and two to leave off your radar.
Two Industrials Stocks to Sell:
FTAI Infrastructure (FIP)
Trailing 12-Month Free Cash Flow Margin: -75.4%
Spun off from FTAI Aviation in 2021, FTAI Infrastructure (NASDAQ: FIP) invests in and operates infrastructure and related assets across the transportation and energy sectors.
Why Is FIP Not Exciting?
- Historical operating margin losses point to an inefficient cost structure
- Historically negative EPS is a worrisome sign for conservative investors and obscures its long-term earnings potential
- Negative free cash flow raises questions about the return timeline for its investments
FTAI Infrastructure’s stock price of $5.79 implies a valuation ratio of 2.1x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than FIP.
Plug Power (PLUG)
Trailing 12-Month Free Cash Flow Margin: -115%
Powering forklifts for Walmart’s distribution centers, Plug Power (NASDAQ: PLUG) provides hydrogen fuel cells used to power electric motors.
Why Are We Out on PLUG?
- Sales tumbled by 12.6% annually over the last two years, showing market trends are working against its favor during this cycle
- 6,283 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
At $3.43 per share, Plug Power trades at 4.8x forward price-to-sales. To fully understand why you should be careful with PLUG, check out our full research report (it’s free for active Edge members).
One Industrials Stock to Watch:
Graham Corporation (GHM)
Trailing 12-Month Free Cash Flow Margin: -4.5%
Founded when its founder patented a unique design for a vacuum system used in the sugar refining process, Graham (NYSE: GHM) provides vacuum and heat transfer equipment for the energy, petrochemical, refining, and chemical sectors.
Why Is GHM Interesting?
- Average backlog growth of 21.7% over the past two years shows it has a steady sales pipeline that will drive future orders
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Additional sales over the last two years increased its profitability as the 145% annual growth in its earnings per share outpaced its revenue
Graham Corporation is trading at $59.68 per share, or 43.4x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free for active Edge members.
Stocks We Like Even More
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out 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 Tecnoglass (+1,754% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
