Rapid spending isn’t always a sign of progress. Some cash-burning businesses fail to convert investments into meaningful competitive advantages, leaving them vulnerable.

Just because a company is spending heavily doesn’t mean it’s on the right track, and StockStory is here to separate the winners from the losers. That said, here are three cash-burning companies to avoid and some better opportunities instead.

JELD-WEN (JELD)

Trailing 12-Month Free Cash Flow Margin: -5.1%

Founded in the 1960s as a general wood-making company, JELD-WEN (NYSE: JELD) manufactures doors, windows, and other related building products.

Why Do We Pass on JELD?

1. Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
2. Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
3. Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution

At $2.20 per share, JELD-WEN trades at 1.3x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than JELD.

Bausch + Lomb (BLCO)

Trailing 12-Month Free Cash Flow Margin: -3.9%

With a nearly 170-year history dedicated to vision care and eye health innovation, Bausch + Lomb (NYSE: BLCO) develops and manufactures a comprehensive range of eye health products including contact lenses, pharmaceuticals, surgical devices, and consumer eye care solutions.

Why Are We Hesitant About BLCO?

1. Earnings per share fell by 20.4% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
2. Free cash flow margin dropped by 26.8 percentage points over the last five years, implying the company became more capital intensive as competition picked up
3. Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders

Bausch + Lomb is trading at $16.01 per share, or 17.2x forward P/E. Check out our free in-depth research report to learn more about why BLCO doesn’t pass our bar.

Rumble (RUM)

Trailing 12-Month Free Cash Flow Margin: -53.1%

Founded in 2013 as a champion for content creator rights and free expression, Rumble (NASDAQ: RUM) is a video sharing platform that positions itself as a free speech alternative to mainstream platforms, offering creators more favorable revenue-sharing opportunities.

Why Are We Wary of RUM?

1. Efficiency has decreased over the last five years as its operating margin fell by 91.8 percentage points
2. Incremental sales over the last two years were much less profitable as its earnings per share fell by 76.5% annually while its revenue grew
3. Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 46.7 percentage points

Rumble’s stock price of $5.90 implies a valuation ratio of 9.4x forward price-to-sales. Read our free research report to see why you should think twice about including RUM in your portfolio.

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 9 Market-Beating Stocks. 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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.