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 are two companies with net cash positions that can continue growing sustainably and one with hidden risks.
One Stock to Sell:
Marcus & Millichap (MMI)
Net Cash Position: $174.2 million (16.4% of Market Cap)
Founded in 1971, Marcus & Millichap (NYSE: MMI) specializes in commercial real estate investment sales, financing, research, and advisory services.
Why Should You Sell MMI?
- Lackluster 1.3% annual revenue growth over the last five years indicates the company is losing ground to competitors
- Poor free cash flow margin of 3% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $27.12 per share, Marcus & Millichap trades at 59.1x forward P/E. Dive into our free research report to see why there are better opportunities than MMI.
Two Stocks to Watch:
Watts Water Technologies (WTS)
Net Cash Position: $260.2 million (2.6% of Market Cap)
Founded in 1874, Watts Water (NYSE: WTS) specializes in manufacturing water products and systems for residential, commercial, and industrial applications globally.
Why Are We Bullish on WTS?
- 9.3% annual revenue growth over the last five years surpassed the sector average as its offerings resonated with customers
- Offerings are mission-critical for businesses and result in a best-in-class gross margin of 45.9%
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
Watts Water Technologies is trading at $297.29 per share, or 26.8x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Medpace (MEDP)
Net Cash Position: $141.4 million (0.8% of Market Cap)
Founded in 1992 as a scientifically-driven alternative to traditional contract research organizations, Medpace (NASDAQ: MEDP) provides outsourced clinical trial management and research services to help pharmaceutical, biotechnology, and medical device companies develop new treatments.
Why Do We Watch MEDP?
- Existing business lines can expand without risky acquisitions as its organic revenue growth averaged 15.1% over the past two years
- Market share is on track to rise over the next 12 months as its 17.9% projected revenue growth implies demand will accelerate from its two-year trend
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
Medpace’s stock price of $610.73 implies a valuation ratio of 38.8x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in 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 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.
