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.
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. Keeping that in mind, here is one company with a net cash position that can continue growing sustainably and two best left off your watchlist.
Two Stocks to Sell:
Amplitude (AMPL)
Net Cash Position: $130.8 million (8.4% 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 Does AMPL Fall Short?
- Net revenue retention rate of 104% trails the industry benchmark of 110%+ and shows it has a tough time increasing customer spending
- Persistent operating margin losses suggest the business manages its expenses poorly
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
Amplitude is trading at $12.27 per share, or 3.6x forward price-to-sales. Dive into our free research report to see why there are better opportunities than AMPL.
Teradyne (TER)
Net Cash Position: $254.7 million (0.4% of Market Cap)
Sporting most major chip manufacturers as its customers, Teradyne (NASDAQ: TER) is a US-based supplier of automated test equipment for semiconductors as well as other technologies and devices.
Why Are We Hesitant About TER?
- Decent 5.3% annual revenue growth over the last five years beat most of its peers, showing customers find value in its products and services
- Estimated sales growth of 24.4% for the next 12 months implies demand will slow from its two-year trend
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 6.2 percentage points
Teradyne’s stock price of $370.05 implies a valuation ratio of 39.3x forward P/E. Check out our free in-depth research report to learn more about why TER doesn’t pass our bar.
One Stock to Watch:
MongoDB (MDB)
Net Cash Position: $2.38 billion (7.9% of Market Cap)
Named after "humongous database," reflecting its ability to handle massive data loads, MongoDB (NASDAQ: MDB) provides a flexible document-based database platform that helps developers build, deploy, and maintain modern applications more efficiently.
Why Does MDB Stand Out?
- Winning new contracts that can potentially increase in value as its billings growth has averaged 32.4% over the last year
- Forecasted revenue growth of 17.7% for the next 12 months indicates its momentum over the last two years is sustainable
- Above-average gross margin of 72.7% gives it the ability to invest in R&D and run marketing campaigns
At $372.75 per share, MongoDB trades at 9x forward price-to-sales. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
