A cash-heavy balance sheet is often a sign of strength, but not always. Some companies avoid debt because they have weak business models, limited expansion opportunities, or inconsistent cash flow.
Not all businesses with cash are winners, and that’s why we built StockStory - to help you separate the good from the bad. That said, here are two companies with net cash positions that can leverage their balance sheets to grow and one with hidden risks.
One Stock to Sell:
First Solar (FSLR)
Net Cash Position: $576 million (2.3% of Market Cap)
Headquartered in Arizona, First Solar (NASDAQ: FSLR) specializes in manufacturing solar panels and providing photovoltaic solar energy solutions.
Why Does FSLR Give Us Pause?
- 6.8% annual revenue growth over the last five years was slower than its industrials peers
- Free cash flow margin shrank by 18.9 percentage points over the last five years, suggesting the company stepped up its investments to maintain its competitive edge
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
First Solar’s stock price of $238.39 implies a valuation ratio of 12.1x forward P/E. If you’re considering FSLR for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Cadence Design Systems (CDNS)
Net Cash Position: $344.6 million (0.4% of Market Cap)
Powering the chips behind everything from smartphones to AI accelerators for over 35 years, Cadence Design Systems (NASDAQ: CDNS) provides essential computational software, hardware, and intellectual property used by engineers to design and verify advanced electronic systems and semiconductors.
Why Are We Positive On CDNS?
- Average billings growth of 25.5% over the last year enhances its liquidity and shows there is steady demand for its products
- Superior software functionality and low servicing costs are reflected in its best-in-class gross margin of 85.6%
- Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
At $321.71 per share, Cadence Design Systems trades at 16x forward price-to-sales. Is now the right time to buy? See for yourself in our full research report, it’s free for active Edge members.
Rumble (RUM)
Net Cash Position: $281.4 million (11.1% of Market Cap)
Founded in 2013 as a champion for content creator rights and free expression, Rumble (NASDAQ: RUM) is a video sharing platform that positions itself as a free speech alternative to mainstream platforms, offering creators more favorable revenue-sharing opportunities.
Why Does RUM Stand Out?
- Annual revenue growth of 19% over the last two years was superb and indicates its market share increased during this cycle
- Estimated revenue growth of 7.8% for the next 12 months implies its momentum over the last two years will continue
Rumble is trading at $7.50 per share, or 18.7x trailing 12-month price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
Donald Trump’s April 2025 "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 Strong Momentum 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-small-cap company Comfort Systems (+782% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
