A company that generates cash isn’t automatically a winner. Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.

Luckily for you, we built StockStory to help you separate the good from the bad. Keeping that in mind, here is one cash-producing company that reinvests wisely to drive long-term success and two best left off your watchlist.

Two Stocks to Sell:

Monro (MNRO)

Trailing 12-Month Free Cash Flow Margin: 8.8%

Started as a single location in Rochester, New York, Monro (NASDAQ: MNRO) provides common auto services such as brake repairs, tire replacements, and oil changes.

Why Is MNRO Risky?

1. Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
2. Smaller revenue base of $1.20 billion means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
3. Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term

Monro’s stock price of $16.21 implies a valuation ratio of 19.7x forward P/E. Check out our free in-depth research report to learn more about why MNRO doesn’t pass our bar.

Travel + Leisure (TNL)

Trailing 12-Month Free Cash Flow Margin: 11.7%

Formerly known as Wyndham Destinations, Travel + Leisure (NYSE: TNL) is a global vacation company that provides travelers with vacation ownership, exchange, and travel services.

Why Does TNL Worry Us?

1. Performance surrounding its tours conducted has lagged its peers
2. Estimated sales growth of 2.8% for the next 12 months is soft and implies weaker demand
3. High net-debt-to-EBITDA ratio of 8× could force the company to raise capital at unfavorable terms if market conditions deteriorate

At $49.96 per share, Travel + Leisure trades at 7.5x forward P/E. Dive into our free research report to see why there are better opportunities than TNL.

One Stock to Watch:

Cadence (CDNS)

Trailing 12-Month Free Cash Flow Margin: 28.3%

With the name chosen to reflect the idea of a repeating pattern or rhythm in electronic design, Cadence Design Systems (NASDAQ: CDNS) offers a software-as-a-service platform for semiconductor engineering and design.

Why Are We Fans of CDNS?

1. Billings have averaged 24% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
2. Superior software functionality and low servicing costs are reflected in its best-in-class gross margin of 85.9%
3. Software platform has product-market fit given the rapid recovery of its customer acquisition costs

Cadence is trading at $297.10 per share, or 15.3x forward price-to-sales. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.

High-Quality Stocks for All Market Conditions

The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.

While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out 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 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% 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.