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. That said, here is one company with a net cash position that balances growth with stability and two best left off your watchlist.
Two Stocks to Sell:
Movado (MOV)
Net Cash Position: $153 million (18.4% of Market Cap)
With its watches displayed in 20 museums around the world, Movado (NYSE: MOV) is a watchmaking company with a portfolio of watch brands and accessories.
Why Do We Pass on MOV?
- Annual revenue growth of 3.6% over the last five years was below our standards for the consumer discretionary sector
- Low free cash flow margin of 5.2% for the last two years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
Movado is trading at $37.40 per share, or 11.4x forward EV-to-EBITDA. If you’re considering MOV for your portfolio, see our FREE research report to learn more.
Preferred Bank (PFBC)
Net Cash Position: $442 million (38.9% of Market Cap)
Founded in 1991 with a focus on serving the Pacific Rim community in Southern California, Preferred Bank (NASDAQ: PFBC) is a commercial bank that provides banking products and services to small and mid-sized businesses, entrepreneurs, real estate developers, and high net worth individuals.
Why Do We Think Twice About PFBC?
- 9% annual net interest income growth over the last five years was slower than its banking peers
- 61.7 basis point (100 basis points = 1 percentage point) decline in its net interest margin over the last two years reflects the firm’s willingness to accept lower profitability to defend its market position
- Earnings per share lagged its peers over the last two years as they only grew by 1.3% annually
Preferred Bank’s stock price of $95.97 implies a valuation ratio of 1.3x forward P/B. Dive into our free research report to see why there are better opportunities than PFBC.
One Stock to Buy:
CrowdStrike (CRWD)
Net Cash Position: $3.73 billion (2% of Market Cap)
Known for detecting the massive SolarWinds hack in 2020 that compromised numerous government agencies, CrowdStrike (NASDAQ: CRWD) provides cloud-based cybersecurity solutions that protect endpoints, cloud workloads, identity, and data through its Falcon platform.
Why Is CRWD a Good Business?
- Billings have averaged 24.9% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
- Projected revenue growth of 22.6% for the next 12 months suggests its momentum from the last two years will persist
- User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
At $715.51 per share, CrowdStrike trades at 30.9x forward price-to-sales. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
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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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
