A surplus of cash can mean financial stability, but it can also indicate a reluctance (or inability) to invest in growth. Some of these companies also face challenges like stagnating revenue, declining market share, or limited scalability.

Not all businesses with cash are winners, and that’s why we built StockStory - to help you separate the good from the bad. Keeping that in mind, here is one company with a net cash position that can continue growing sustainably and two that may struggle.

Two Stocks to Sell:

Zoom (ZM)

Net Cash Position: $7.75 billion (30.5% of Market Cap)

Once the verb that defined remote work during the pandemic ("let's Zoom later"), Zoom (NASDAQ: ZM) provides a cloud-based platform for video meetings, phone calls, team chat, and collaboration tools that helps businesses and individuals connect virtually.

Why Do We Avoid ZM?

1. Average billings growth of 4.4% over the last year was subpar, suggesting it struggled to push its software and might have to lower prices to stimulate demand
2. Competitive market dynamics make it difficult to retain customers, leading to a weak 98% net revenue retention rate
3. Anticipated sales growth of 3.2% for the next year implies demand will be shaky

Zoom is trading at $84.95 per share, or 5.3x forward price-to-sales. Check out our free in-depth research report to learn more about why ZM doesn’t pass our bar.

Amplitude (AMPL)

Net Cash Position: $203.2 million (15.3% of Market Cap)

Born from the realization that companies were flying blind when it came to understanding user behavior in their digital products, Amplitude (NASDAQ: AMPL) provides a digital analytics platform that helps businesses understand how people use their digital products to improve user experiences and drive revenue growth.

Why Do We Pass on AMPL?

1. Customers had second thoughts about committing to its platform over the last year as its average billings growth of 9.9% underwhelmed
2. Struggled to drive increased usage of its software, demonstrated by its subpar 100% net revenue retention rate
3. Operating margin was unchanged over the last year, suggesting it failed to gain leverage on its fixed costs

At $10.01 per share, Amplitude trades at 3.7x forward price-to-sales. Read our free research report to see why you should think twice about including AMPL in your portfolio.

One Stock to Watch:

Yelp (YELP)

Net Cash Position: $270.5 million (13.2% of Market Cap)

Founded by PayPal alumni Jeremy Stoppelman and Russel Simmons, Yelp (NYSE: YELP) is an online platform that helps people discover local businesses through crowd-sourced reviews.

Why Are We Positive On YELP?

1. Platform is difficult to replicate at scale and leads to a best-in-class gross margin of 91.1%
2. Highly efficient business model is illustrated by its impressive 26% EBITDA margin, and its profits increased over the last few years as it scaled
3. Share repurchases have amplified shareholder returns as its annual earnings per share growth of 28.4% exceeded its revenue gains over the last three years

Yelp’s stock price of $32.49 implies a valuation ratio of 6x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our full research report, it’s free for active Edge members.

High-Quality Stocks for All Market Conditions

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. 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 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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