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. Keeping that in mind, here are three companies with net cash positions to steer clear of and a few alternatives to consider.
Box (BOX)
Net Cash Position: $2.05 million (0.1% of Market Cap)
Known as the "Content Cloud" for managing the 90% of business data that exists as unstructured files and documents, Box (NYSE:BOX) provides a cloud-based platform that enables organizations to securely manage, share, and collaborate on their content from anywhere on any device.
Why Does BOX Give Us Pause?
- Customers had second thoughts about committing to its platform over the last year as its average billings growth of 11.9% underwhelmed
- Estimated sales growth of 7.7% for the next 12 months is soft and implies weaker demand
- Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 1.6 percentage points
Box’s stock price of $25.33 implies a valuation ratio of 3.1x forward price-to-sales. Read our free research report to see why you should think twice about including BOX in your portfolio.
C3.ai (AI)
Net Cash Position: $675 million (43.6% of Market Cap)
Named after the three Cs of its original focus—carbon, cloud computing, and customer relationship management—C3.ai (NYSE:AI) provides enterprise AI software that helps organizations develop, deploy, and operate large-scale artificial intelligence applications across various industries.
Why Do We Steer Clear of AI?
- Offerings struggled to generate meaningful interest as its average billings growth of 3.8% over the last year did not impress
- Bad unit economics and steep infrastructure costs are reflected in its gross margin of 51.8%, one of the worst among software companies
- Cash-burning history makes us doubt the long-term viability of its business model
At $11.02 per share, C3.ai trades at 5.4x forward price-to-sales. Dive into our free research report to see why there are better opportunities than AI.
Novavax (NVAX)
Net Cash Position: $522.6 million (36.4% of Market Cap)
Pioneering a nanoparticle technology that mimics the molecular structure of disease pathogens, Novavax (NASDAQ:NVAX) develops and commercializes protein-based vaccines for infectious diseases, with a primary focus on its COVID-19 vaccine and combination respiratory vaccine candidates.
Why Do We Think Twice About NVAX?
- Flat sales over the last two years suggest it must find different ways to grow during this cycle
- Estimated sales decline of 52% for the next 12 months implies an even more challenging demand environment
- 73.8 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
Novavax is trading at $8.82 per share, or 3x forward price-to-sales. To fully understand why you should be careful with NVAX, check out our full research report (it’s free).
Stocks We Like 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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.