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. That said, here is one company with a net cash position that can leverage its balance sheet to grow and two that may struggle.
Two Stocks to Sell:
Marqeta (MQ)
Net Cash Position: $818.6 million (38% of Market Cap)
Powering the cards behind innovative fintech services like Block's Cash App, Marqeta (NASDAQ:MQ) provides a cloud-based platform that allows businesses to create customized payment card programs and process card transactions.
Why Are We Hesitant About MQ?
- Software offerings aren’t resonating in this new AI paradigm as its revenue declined by 19% annually over the last two years
- Inability to adjust its cost structure while its revenue declined over the last year led to a 4.3 percentage point drop in the company’s operating margin
- Poor free cash flow margin of 9.9% for the last year limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
Marqeta is trading at $4.81 per share, or 3.4x forward price-to-sales. Dive into our free research report to see why there are better opportunities than MQ.
Perella Weinberg (PWP)
Net Cash Position: $135.1 million (10.4% of Market Cap)
Founded in 2006 by veteran investment bankers Joseph Perella and Peter Weinberg during a wave of boutique advisory firm launches, Perella Weinberg Partners (NASDAQ:PWP) is a global independent advisory firm that provides strategic and financial advice to corporations, financial sponsors, and government institutions.
Why Are We Cautious About PWP?
- Flat earnings per share over the last three years underperformed the sector average
- Negative return on equity shows that some of its growth strategies have backfired
Perella Weinberg’s stock price of $20.36 implies a valuation ratio of 19x forward P/E. If you’re considering PWP for your portfolio, see our FREE research report to learn more.
One Stock to Buy:
Sterling (STRL)
Net Cash Position: $356.4 million (3.1% of Market Cap)
Involved in the construction of a major highway, the Grand Parkway in Houston, TX, Sterling Infrastructure (NASDAQ:STRL) provides civil infrastructure construction.
Why Is STRL a Good Business?
- Solid 9.9% annual revenue growth over the last five years indicates its offering’s solve complex business issues
- Free cash flow margin increased by 12.1 percentage points over the last five years, giving the company more capital to invest or return to shareholders
- Rising returns on capital show management is finding more attractive investment opportunities
At $376.70 per share, Sterling trades at 37.9x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .
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 5 Growth Stocks for this month. 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 Comfort Systems (+782% 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
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