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.
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:
Supernus Pharmaceuticals (SUPN)
Net Cash Position: $217.8 million (7.4% of Market Cap)
With a diverse portfolio of eight FDA-approved medications targeting neurological conditions, Supernus Pharmaceuticals (NASDAQ:SUPN) develops and markets treatments for central nervous system disorders including epilepsy, ADHD, Parkinson's disease, and migraine.
Why Are We Out on SUPN?
- Annual revenue growth of 5.9% over the last five years was below our standards for the healthcare sector
- Subscale operations are evident in its revenue base of $681.5 million, meaning it has fewer distribution channels than its larger rivals
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
Supernus Pharmaceuticals is trading at $51.67 per share, or 26.7x forward P/E. Read our free research report to see why you should think twice about including SUPN in your portfolio.
Frost Bank (CFR)
Net Cash Position: $3.32 billion (35.8% of Market Cap)
Tracing its roots back to 1868 when it was founded during Texas's post-Civil War reconstruction era, Cullen/Frost Bankers (NYSE:CFR) operates Frost Bank, a Texas-based financial institution providing commercial and consumer banking, wealth management, and insurance services.
Why Do We Think Twice About CFR?
- Muted 6.1% annual revenue growth over the last two years shows its demand lagged behind its banking peers
- Annual earnings per share growth of 2.2% underperformed its revenue over the last two years, showing its incremental sales were less profitable
- Tangible book value per share is projected to decrease by 3.6% over the next 12 months as capital generation weakens
At $146.70 per share, Frost Bank trades at 1.9x forward P/B. To fully understand why you should be careful with CFR, check out our full research report (it’s free).
One Stock to Buy:
Napco (NSSC)
Net Cash Position: $110.1 million (7.1% of Market Cap)
Protecting everything from schools to government facilities since 1969, Napco Security Technologies (NASDAQ:NSSC) manufactures electronic security devices, access control systems, and communication services for intrusion and fire alarm systems.
Why Should You Buy NSSC?
- Annual revenue growth of 14% over the past five years was outstanding, reflecting market share gains this cycle
- Strong free cash flow margin of 19.3% enables it to reinvest or return capital consistently, and its growing cash flow gives it even more resources to deploy
- Returns on capital are growing as management capitalizes on its market opportunities
Napco’s stock price of $43.56 implies a valuation ratio of 28.6x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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.