Companies with more cash than debt often have stronger financial flexibility, making them attractive in uncertain markets. Without interest payments being less of a worry, these businesses can invest more in growth, innovation, or buybacks and dividends.
Finding the best investments isn’t always easy, and that’s why we started StockStory. That said, here are three companies with net cash positions that can continue growing sustainably.
Semrush (SEMR)
Net Cash Position: $248 million (16.6% of Market Cap)
Started by Oleg Shchegolev while still in university, Semrush (NYSE: SEMR) is a software-as-a-service platform that helps companies optimize their search engine and content marketing efforts.
Why Does SEMR Stand Out?
- Winning new contracts that can potentially increase in value as its billings growth has averaged 24.8% over the last year
- Forecasted revenue growth of 18.7% for the next 12 months indicates its momentum over the last three years is sustainable
- Software is difficult to replicate at scale and results in a premier gross margin of 82.1%
Semrush is trading at $10.11 per share, or 3.2x forward price-to-sales. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Axon (AXON)
Net Cash Position: $360.3 million (0.6% of Market Cap)
Providing body cameras and tasers for first responders, AXON (NASDAQ: AXON) develops technology solutions and weapons products for military, law enforcement, and civilians.
Why Are We Backing AXON?
- Unit sales averaged 32% growth over the past two years and imply healthy demand for its products
- Free cash flow margin jumped by 20.3 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
- Historical investments are beginning to pay off as its returns on capital are growing
At $790.48 per share, Axon trades at 132.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
ResMed (RMD)
Net Cash Position: $92.94 million (0.3% of Market Cap)
Founded in 1989 to address the then-underdiagnosed condition of sleep apnea, ResMed (NYSE: RMD) develops cloud-connected medical devices and software solutions that treat sleep apnea, COPD, and other respiratory disorders for home and clinical use.
Why Are We Fans of RMD?
- Constant currency growth averaged 12% over the past two years, showing it can expand globally regardless of the macroeconomic environment
- Performance over the past five years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 15.7% outpaced its revenue gains
- Free cash flow margin expanded by 7.1 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
ResMed’s stock price of $249.69 implies a valuation ratio of 24.6x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
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