A surplus of cash can mean financial stability, but it can also indicate a reluctance (or inability) to invest in growth. Some of these companies also face challenges like stagnating revenue, declining market share, or limited scalability.
Not all businesses with cash are winners, and that’s why we built StockStory - to help you separate the good from the bad. Keeping that in mind, here is one company with a net cash position that can continue growing sustainably and two best left off your watchlist.
Two Stocks to Sell:
Workiva (WK)
Net Cash Position: $68.52 million (1.7% of Market Cap)
Nicknamed "the Excel killer" by some finance professionals for its ability to eliminate spreadsheet chaos, Workiva (NYSE: WK) provides a cloud-based platform that enables organizations to streamline financial reporting, ESG, and compliance processes with connected data and automation.
Why Are We Cautious About WK?
- Operating margin improvement of 2.8 percentage points over the last year demonstrates its ability to scale efficiently
- Projected 3.1 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
Workiva’s stock price of $71.85 implies a valuation ratio of 4.3x forward price-to-sales. If you’re considering WK for your portfolio, see our FREE research report to learn more.
Figs (FIGS)
Net Cash Position: $187.4 million (10.4% of Market Cap)
Rising to fame via TikTok and founded in 2013 by Heather Hasson and Trina Spear, Figs (NYSE: FIGS) is a healthcare apparel company known for its stylish approach to medical attire and uniforms.
Why Do We Steer Clear of FIGS?
- Demand for its offerings was relatively low as its number of active customers has underwhelmed
- Low free cash flow margin of 6.4% for the last two years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
- Rising returns on capital show management is making relatively better investments
Figs is trading at $10.54 per share, or 108.1x forward P/E. To fully understand why you should be careful with FIGS, check out our full research report (it’s free).
One Stock to Watch:
NetApp (NTAP)
Net Cash Position: $486 million (2.4% of Market Cap)
Founded in 1992 as a pioneer in networked storage technology, NetApp (NASDAQ: NTAP) provides data storage and management solutions that help organizations store, protect, and optimize their data across on-premises data centers and public clouds.
Why Do We Like NTAP?
- Billings have averaged 7.2% growth over the past two years, showing it’s securing new contracts that could potentially increase in value over time
- Adjusted operating margin expanded by 5.9 percentage points over the last five years as it scaled and became more efficient
- NTAP is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its improved cash conversion implies it’s becoming a less capital-intensive business
At $100.50 per share, NetApp trades at 11.5x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
