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.
Financial flexibility is valuable, but it’s not everything - at StockStory, we help you find the stocks that can not only survive but also outperform. That said, here are two companies with net cash positions that can continue growing sustainably and one that may struggle.
One Stock to Sell:
PACCAR (PCAR)
Net Cash Position: $9.23 billion (14.2% of Market Cap)
Founded more than a century ago, PACCAR (NASDAQ: PCAR) designs and manufactures commercial trucks of various weights and sizes for the commercial trucking industry.
Why Are We Wary of PCAR?
- Sales tumbled by 10% annually over the last two years, showing market trends are working against its favor during this cycle
- Gross margin of 16.5% reflects its high production costs
- Earnings per share have dipped by 27.8% annually over the past two years, which is concerning because stock prices follow EPS over the long term
PACCAR’s stock price of $123.46 implies a valuation ratio of 22.5x forward P/E. Dive into our free research report to see why there are better opportunities than PCAR.
Two Stocks to Watch:
Workiva (WK)
Net Cash Position: $99.98 million (3.1% of Market Cap)
Nicknamed "the Excel killer" by some finance professionals for its ability to eliminate spreadsheet chaos, Workiva (NYSE: WK) provides a cloud-based platform that enables organizations to streamline financial reporting, ESG, and compliance processes with connected data and automation.
Why Could WK Be a Winner?
- ARR trends over the last year show it’s maintaining a steady flow of long-term contracts that contribute positively to its revenue predictability
- Software is difficult to replicate at scale and results in a premier gross margin of 78.5%
- Free cash flow margin is expected to increase by 3.2 percentage points next year, suggesting the company will have more capital to invest or return to shareholders
At $56.47 per share, Workiva trades at 3.1x forward price-to-sales. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Dynatrace (DT)
Net Cash Position: $1.10 billion (10.4% of Market Cap)
With its platform processing over 30 trillion pieces of IT performance data daily, Dynatrace (NYSE: DT) provides an AI-powered platform that helps organizations monitor, secure, and optimize their applications and IT infrastructure across cloud environments.
Why Are We Positive On DT?
- Billings have averaged 22.5% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
- Software is difficult to replicate at scale and results in a stellar gross margin of 81.7%
- Robust free cash flow margin of 23.9% gives it many options for capital deployment
Dynatrace is trading at $35.52 per share, or 4.5x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.
