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.
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 balance growth with stability and one best left off your watchlist.
One Stock to Sell:
SmartRent (SMRT)
Net Cash Position: $92.66 million (40.3% of Market Cap)
Founded by an employee at a real estate rental company, SmartRent (NYSE: SMRT) provides smart home devices and software for multifamily residential properties, single-family rental homes, and student housing communities.
Why Does SMRT Worry Us?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 16.6% annually over the last two years
- Historically negative EPS raises concerns for risk-averse investors and makes its earnings potential harder to gauge
- Cash burn makes us question whether it can achieve sustainable long-term growth
SmartRent is trading at $1.21 per share, or 31x forward EV-to-EBITDA. If you’re considering SMRT for your portfolio, see our FREE research report to learn more.
Two Stocks to Buy:
Nvidia (NVDA)
Net Cash Position: $66 billion (1.1% of Market Cap)
Founded in 1993 by Jensen Huang and two former Sun Microsystems engineers, Nvidia (NASDAQ: NVDA) is a leading fabless designer of chips used in gaming, PCs, data centers, automotive, and a variety of end markets.
Why Will NVDA Outperform?
- Annual revenue growth of 77.4% over the last two years was superb and indicates its market share increased during this cycle
- Share buybacks catapulted its annual earnings per share growth to 82.6%, which outperformed its revenue gains over the last five years
- NVDA is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its recently improved profitability means it has even more resources to invest or distribute
Nvidia’s stock price of $240.19 implies a valuation ratio of 19.3x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
EMCOR (EME)
Net Cash Position: $382.5 million (1.1% of Market Cap)
Through its network of over 70 subsidiaries, EMCOR (NYSE: EME) provides electrical, mechanical, and building construction and services
Why Should You Buy EME?
- Annual revenue growth of 16.3% over the last two years was superb and indicates its market share increased during this cycle
- Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Rising returns on capital show management is finding more attractive investment opportunities
At $780.15 per share, EMCOR trades at 22.6x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
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.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as ServiceNow (+164% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
