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 are two cash-producing companies that excel at turning cash into shareholder value and one that may face some trouble.

One Stock to Sell:

Champion Homes (SKY)

Trailing 12-Month Free Cash Flow Margin: 7.6%

Founded in 1951, Champion Homes (NYSE: SKY) is a manufacturer of modular homes and buildings in North America.

Why Do We Think Twice About SKY?

1. Underwhelming unit sales over the past two years show it’s struggled to increase its sales volumes and had to rely on price increases
2. Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
3. Eroding returns on capital suggest its historical profit centers are aging

Champion Homes’s stock price of $66.39 implies a valuation ratio of 16.8x forward P/E. Dive into our free research report to see why there are better opportunities than SKY.

Two Stocks to Watch:

Broadcom (AVGO)

Trailing 12-Month Free Cash Flow Margin: 39.8%

Originally the semiconductor division of Hewlett Packard, Broadcom (NASDAQ: AVGO) is a semiconductor conglomerate spanning wireless communications, networking, and data storage as well as infrastructure software focused on mainframes and cybersecurity.

Why Are We Backing AVGO?

1. Market share has increased this cycle as its 27.6% annual revenue growth over the last two years was exceptional
2. Offerings are difficult to replicate at scale and lead to a best-in-class gross margin of 75.8%
3. AVGO is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders

Broadcom is trading at $291.85 per share, or 39.2x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

Warby Parker (WRBY)

Trailing 12-Month Free Cash Flow Margin: 5.3%

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 Positive On WRBY?

1. Aggressive expansion of new stores reflects an offensive push to quickly grow and sell in markets where it has few or no locations
2. Differentiated product assortment results in a best-in-class gross margin of 55.1%
3. Earnings per share have massively outperformed its peers over the last three years, increasing by 62.4% annually

At $24.46 per share, Warby Parker trades at 65.3x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

High-Quality Stocks for All Market Conditions

Donald Trump’s April 2024 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check 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-small-cap company Exlservice (+354% 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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