Rapid spending isn’t always a sign of progress. Some cash-burning businesses fail to convert investments into meaningful competitive advantages, leaving them vulnerable.
Negative cash flow can lead to trouble, but StockStory helps you identify the businesses that stand a chance of making it through. Keeping that in mind, here is one high-risk, high-reward company investing aggressively to carve out a leadership position and two that may struggle to stay afloat.
Two Stocks to Sell:
Sleep Number (SNBR)
Trailing 12-Month Free Cash Flow Margin: -3.3%
Known for mattresses that can be adjusted with regards to firmness, Sleep Number (NASDAQ:SNBR) manufactures and sells its own brand of bedding products such as mattresses, bed frames, and pillows.
Why Do We Think SNBR Will Underperform?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Sales were less profitable over the last three years as its earnings per share fell by 43.2% annually, worse than its revenue declines
- Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders
At $10.51 per share, Sleep Number trades at 15.5x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including SNBR in your portfolio.
Graphic Packaging Holding (GPK)
Trailing 12-Month Free Cash Flow Margin: -3.5%
Founded in 1991, Graphic Packaging (NYSE:GPK) is a provider of paper-based packaging solutions for a wide range of products.
Why Are We Out on GPK?
- Declining unit sales over the past two years indicate demand is soft and that the company may need to revise its strategy
- Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
Graphic Packaging Holding’s stock price of $15.47 implies a valuation ratio of 9.1x forward P/E. Dive into our free research report to see why there are better opportunities than GPK.
One Stock to Watch:
FTAI Infrastructure (FIP)
Trailing 12-Month Free Cash Flow Margin: -83.4%
Spun off from FTAI Aviation in 2021, FTAI Infrastructure (NASDAQ:FIP) invests in and operates infrastructure and related assets across the transportation and energy sectors.
Why Could FIP Be a Winner?
- Annual revenue growth of 19% over the past two years was outstanding, reflecting market share gains this cycle
- Demand for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust revenue growth of 73.5%
FTAI Infrastructure is trading at $6.20 per share, or 12x forward EV-to-EBITDA. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Stocks We Like Even More
Check out the high-quality names we’ve flagged in our Top 6 Stocks for this week. 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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.