Companies with more cash than debt can be financially resilient, but that doesn’t mean they’re all strong investments. Some lack leverage because they struggle to grow or generate consistent profits, making them unattractive borrowers.
Financial flexibility is valuable, but it’s not everything - at StockStory, we help you find the stocks that can not only survive but also outperform. 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:
Figs (FIGS)
Net Cash Position: $199.9 million (19.8% 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 Are We Wary of FIGS?
- Performance surrounding its active customers has lagged its peers
- Earnings per share have dipped by 100% annually over the past three years, which is concerning because stock prices follow EPS over the long term
- Push for growth has led to negative returns on capital, signaling value destruction
Figs’s stock price of $6.05 implies a valuation ratio of 80.7x forward P/E. To fully understand why you should be careful with FIGS, check out our full research report (it’s free).
Ruger (RGR)
Net Cash Position: $99.3 million (19.4% of Market Cap)
Founded in 1949, Ruger (NYSE: RGR) is an American manufacturer of firearms for the commercial sporting market.
Why Is RGR Risky?
- Annual sales declines of 3.9% for the past two years show its products and services struggled to connect with the market
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 14.6% annually
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
At $32.50 per share, Ruger trades at 17.9x forward EV-to-EBITDA. If you’re considering RGR for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
Veeva Systems (VEEV)
Net Cash Position: $5.99 billion (13% of Market Cap)
Built on top of Salesforce as one of the first vertical-focused cloud platforms, Veeva (NYSE: VEEV) provides data and customer relationship management (CRM) software for organizations in the life sciences industry.
Why Do We Watch VEEV?
- Billings have averaged 15.5% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
- Excellent operating margin of 27% highlights the efficiency of its business model, and its rise over the last year was fueled by some leverage on its fixed costs
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
Veeva Systems is trading at $281 per share, or 14.7x forward price-to-sales. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking 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 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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free.
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