While strong cash flow is a key indicator of stability, it doesn’t always translate to superior returns. Some cash-heavy businesses struggle with inefficient spending, slowing demand, or weak competitive positioning.

Cash flow is valuable, but it’s not everything - StockStory helps you identify the companies that truly put it to work. Keeping that in mind, here is one cash-producing company that leverages its financial strength to beat its competitors and two best left off your watchlist.

Two Stocks to Sell:

Quest (DGX)

Trailing 12-Month Free Cash Flow Margin: 10.4%

Processing approximately one-third of the adult U.S. population's lab tests annually, Quest Diagnostics (NYSE: DGX) provides laboratory testing and diagnostic information services to patients, physicians, hospitals, and other healthcare providers across the United States.

Why Does DGX Worry Us?

1. Underwhelming requisition volumes over the past two years imply it may need to invest in improvements to get back on track
2. Efficiency has decreased over the last five years as its adjusted operating margin fell by 10.3 percentage points
3. Eroding returns on capital suggest its historical profit centers are aging

Quest is trading at $185 per share, or 17.9x forward P/E. Read our free research report to see why you should think twice about including DGX in your portfolio.

Brink's (BCO)

Trailing 12-Month Free Cash Flow Margin: 1.4%

Known for its iconic armored trucks that have been a fixture in American cities since 1859, Brink's (NYSE: BCO) provides secure transportation and management of cash and valuables for banks, retailers, and other businesses worldwide.

Why Does BCO Give Us Pause?

1. 4% annual revenue growth over the last two years was slower than its business services peers
2. Free cash flow margin dropped by 3.4 percentage points over the last five years, implying the company became more capital intensive as competition picked up
3. Below-average returns on capital indicate management struggled to find compelling investment opportunities

At $88.49 per share, Brink's trades at 11.9x forward P/E. If you’re considering BCO for your portfolio, see our FREE research report to learn more.

One Stock to Buy:

Nvidia (NVDA)

Trailing 12-Month Free Cash Flow Margin: 46.6%

Founded in 1993 by Jensen Huang and two former Sun Microsystems engineers, Nvidia (NASDAQ: NVDA) is a leading fabless designer of chips used in gaming, PCs, data centers, automotive, and a variety of end markets.

Why Do We Love NVDA?

1. Annual revenue growth of 120% over the last two years was superb and indicates its market share increased during this cycle
2. Performance over the past five years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 83.3% outpaced its revenue gains
3. Strong free cash flow margin of 45.9% enables it to reinvest or return capital consistently, and its rising cash conversion increases its margin of safety

Nvidia’s stock price of $134.70 implies a valuation ratio of 30.9x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

High-Quality Stocks for All Market Conditions

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

Stocks that made our list in 2020 include now familiar names such as ServiceNow (+178% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.