A surplus of cash can mean financial stability, but it can also indicate a reluctance (or inability) to invest in growth. Some of these companies also face challenges like stagnating revenue, declining market share, or limited scalability.
Just because a business has cash doesn’t mean it’s a good investment. Luckily, StockStory is here to help you separate the winners from the losers. Keeping that in mind, here is one company with a net cash position that balances growth with stability and two with hidden risks.
Two Stocks to Sell:
LiveRamp (RAMP)
Net Cash Position: $376.9 million (20.5% of Market Cap)
Serving as the digital middleman in an increasingly privacy-conscious world, LiveRamp (NYSE: RAMP) provides technology that helps companies securely share and connect their customer data with trusted partners while maintaining privacy compliance.
Why Does RAMP Fall Short?
- Customers were hesitant to make long-term commitments to its software as its 7.4% average ARR growth over the last year was sluggish
- Estimated sales growth of 9% for the next 12 months implies demand will slow from its two-year trend
- Operating margin expanded by 3.6 percentage points over the last year as it scaled and became more efficient
LiveRamp’s stock price of $28.85 implies a valuation ratio of 2.2x forward price-to-sales. Check out our free in-depth research report to learn more about why RAMP doesn’t pass our bar.
Stitch Fix (SFIX)
Net Cash Position: $141.3 million (25.2% of Market Cap)
One of the original subscription box companies, Stitch Fix (NASDAQ: SFIX) is an online personal styling and fashion service that curates personalized clothing selections for customers.
Why Are We Out on SFIX?
- Number of active clients has disappointed over the past two years, indicating weak demand for its offerings
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $4.26 per share, Stitch Fix trades at 15.1x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than SFIX.
One Stock to Watch:
Barrett (BBSI)
Net Cash Position: $84.58 million (9.4% of Market Cap)
Operating as a professional employer organization (PEO) that serves over 8,000 companies with more than 120,000 worksite employees, Barrett Business Services (NASDAQ: BBSI) provides management solutions that help small and mid-sized businesses handle human resources, payroll, workers' compensation, and other administrative functions.
Why Could BBSI Be a Winner?
- Solid 7.2% annual revenue growth over the last two years indicates its offering’s solve complex business issues
- Share repurchases over the last five years enabled its annual earnings per share growth of 10.9% to outpace its revenue gains
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
Barrett is trading at $35.11 per share, or 15.4x 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 Growth Stocks for this month. 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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