Cash-generating companies often have the flexibility to invest, return capital to shareholders, or navigate downturns. The best of these businesses not only accumulate cash but deploy it strategically for growth.
Even among businesses with healthy cash flow, only a select few maximize its potential, and we’re here to pinpoint them. Keeping that in mind, here are three cash-producing companies that reinvest wisely to drive long-term success.
Toast (TOST)
Trailing 12-Month Free Cash Flow Margin: 9.6%
Born from the frustrations of three friends waiting too long for their restaurant bill, Toast (NYSE: TOST) provides a cloud-based digital technology platform with software, payment processing, and hardware solutions built specifically for restaurants.
Why Do We Like TOST?
- Customers view its software as mission-critical to their operations as its ARR has averaged 31.3% growth over the last year
- Estimated revenue growth of 21.1% for the next 12 months implies its momentum over the last two years will continue
Toast’s stock price of $34.78 implies a valuation ratio of 2.9x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
OSI Systems (OSIS)
Trailing 12-Month Free Cash Flow Margin: 7.3%
With security scanners deployed at airports and borders worldwide and patient monitors used in hospitals across the globe, OSI Systems (NASDAQ: OSIS) designs and manufactures specialized electronic systems for security screening, patient monitoring, and optoelectronic applications.
Why Are We Bullish on OSIS?
- Impressive 16.6% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Additional sales over the last two years increased its profitability as the 23.4% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin expanded by 2.4 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
At $270.85 per share, OSI Systems trades at 25.6x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free for active Edge members.
Warby Parker (WRBY)
Trailing 12-Month Free Cash Flow Margin: 4.4%
Founded in 2010, Warby Parker (NYSE: WRBY) designs, manufactures, and sells eyewear, including prescription glasses, sunglasses, and contact lenses, through its e-commerce platform and physical retail locations.
Why Are We Fans of WRBY?
- Aggressive expansion of new stores reflects an offensive push to quickly grow and sell in markets where it has few or no locations
- Revenue outlook for the upcoming 12 months is outstanding and shows it’s on track to gain market share
- Earnings per share grew by 72.3% annually over the last three years and trumped its peers
Warby Parker is trading at $19.81 per share, or 44.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged 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-micro-cap company Kadant (+351% 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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