Generating cash is essential for any business, but not all cash-rich companies are great investments. Some produce plenty of cash but fail to allocate it effectively, leading to missed opportunities.
Not all companies are created equal, and StockStory is here to surface the ones with real upside. Keeping that in mind, here is one cash-producing company that reinvests wisely to drive long-term success and two that may face some trouble.
Two Stocks to Sell:
Bloomin' Brands (BLMN)
Trailing 12-Month Free Cash Flow Margin: 3.3%
Owner of the iconic Australian-themed Outback Steakhouse, Bloomin’ Brands (NASDAQ: BLMN) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.
Why Do We Avoid BLMN?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new restaurants
- Projected sales for the next 12 months are flat and suggest demand will be subdued
- 7× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
At $6.73 per share, Bloomin' Brands trades at 6.5x forward P/E. Read our free research report to see why you should think twice about including BLMN in your portfolio.
Robert Half (RHI)
Trailing 12-Month Free Cash Flow Margin: 4.3%
With roots dating back to 1948 as the first specialized recruiting firm for accounting and finance professionals, Robert Half (NYSE: RHI) provides specialized talent solutions and business consulting services, connecting skilled professionals with companies across various fields.
Why Should You Dump RHI?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 9.4% annually over the last two years
- Performance over the past five years shows each sale was less profitable, as its earnings per share fell by 11.6% annually
- Waning returns on capital imply its previous profit engines are losing steam
Robert Half’s stock price of $28.13 implies a valuation ratio of 18.3x forward P/E. Dive into our free research report to see why there are better opportunities than RHI.
One Stock to Watch:
Accenture (ACN)
Trailing 12-Month Free Cash Flow Margin: 15.6%
With a workforce of approximately 774,000 people serving clients in more than 120 countries, Accenture (NYSE: ACN) is a professional services firm that helps organizations transform their businesses through consulting, technology, operations, and digital services.
Why Do We Like ACN?
- Annual revenue growth of 9.5% over the last five years was superb and indicates its market share increased during this cycle
- Dominant market position is represented by its $69.67 billion in revenue and gives it fixed cost leverage when sales grow
- Industry-leading 39.3% return on capital demonstrates management’s skill in finding high-return investments
Accenture is trading at $246.95 per share, or 17.9x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
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 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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