Companies with more cash than debt can be financially resilient, but that doesn’t mean they’re all strong investments. Some lack leverage because they struggle to grow or generate consistent profits, making them unattractive borrowers.
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 continue growing sustainably and one best left off your watchlist.
One Stock to Sell:
Western Alliance Bancorporation (WAL)
Net Cash Position: $1.66 billion (19.6% of Market Cap)
Operating through five distinct regional banking divisions across the western United States, Western Alliance Bancorporation (NYSE: WAL) provides commercial banking, treasury management, mortgage services, and specialized financial solutions through its banking divisions and subsidiaries.
Why Does WAL Fall Short?
- Efficiency ratio is expected to worsen by 5.9 percentage points over the next year
- Incremental sales over the last five years were less profitable as its 5.8% annual earnings per share growth lagged its revenue gains
At $78.61 per share, Western Alliance Bancorporation trades at 1.1x forward P/B. Read our free research report to see why you should think twice about including WAL in your portfolio.
Two Stocks to Watch:
JFrog (FROG)
Net Cash Position: $724.8 million (8.1% of Market Cap)
Named after the amphibian that continuously evolves from egg to tadpole to adult, JFrog (NASDAQ: FROG) provides a platform that helps organizations securely create, store, manage, and distribute software packages across any system.
Why Is FROG a Top Pick?
- Ability to secure long-term commitments with customers is evident in its 23.7% ARR growth over the last year
- Software platform has product-market fit given the rapid recovery of its customer acquisition costs
- Robust free cash flow margin of 26.9% gives it many options for capital deployment
JFrog’s stock price of $73.20 implies a valuation ratio of 13.1x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free.
Cactus (WHD)
Net Cash Position: $189.1 million (4.4% of Market Cap)
Named for the spiky wellhead equipment that reminded founders of desert cacti, Cactus (NYSE: WHD) manufactures wellheads, valves, and spoolable pipes used in drilling and producing oil and gas wells.
Why Are We Positive On WHD?
- Annual revenue growth of 23.2% over the past nine years was outstanding, reflecting market share gains this cycle
- EBITDA margin improvement of 2.3 percentage points over the last five years demonstrates its ability to scale efficiently
- WHD is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Cactus is trading at $62.27 per share, or 2.7x forward price-to-sales. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
