A company that generates cash isn’t automatically a winner. Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.

Not all companies are created equal, and StockStory is here to surface the ones with real upside. That said, here are two cash-producing companies that excel at turning cash into shareholder value and one that may struggle to keep up.

One Stock to Sell:

Cable One (CABO)

Trailing 12-Month Free Cash Flow Margin: 18.5%

Founded in 1986, Cable One (NYSE: CABO) provides high-speed internet, cable television, and telephone services, primarily in smaller markets across the United States.

Why Should You Sell CABO?

1. Performance surrounding its residential data subscribers has lagged its peers
2. Free cash flow margin is expected to remain in place over the coming year
3. Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value

At $95.26 per share, Cable One trades at 2.3x forward P/E. To fully understand why you should be careful with CABO, check out our full research report (it’s free).

Two Stocks to Watch:

Pinterest (PINS)

Trailing 12-Month Free Cash Flow Margin: 29.7%

Created with the idea of virtually replacing paper catalogues, Pinterest (NYSE: PINS) is an online image and social discovery platform.

Why Do We Like PINS?

1. Monthly Active Users have increased by an average of 11.4% annually, giving it the potential for margin-accretive growth if it can develop valuable complementary products and features
2. Additional sales over the last three years increased its profitability as the 38.2% annual growth in its earnings per share outpaced its revenue
3. Robust free cash flow margin of 27.9% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety

Pinterest is trading at $18.06 per share, or 7.5x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

Moody's (MCO)

Trailing 12-Month Free Cash Flow Margin: 33.4%

Founded in 1900 during America's railroad boom when investors needed reliable information on bond risks, Moody's (NYSE: MCO) provides credit ratings, risk assessment tools, and analytical solutions that help organizations evaluate financial risks and make informed investment decisions.

Why Will MCO Beat the Market?

1. Offerings and unique value proposition resonate with customers, as seen in its above-market 14.2% annual sales growth over the last two years
2. Share buybacks catapulted its annual earnings per share growth to 22.8%, which outperformed its revenue gains over the last two years
3. Stellar return on equity showcases management’s ability to surface highly profitable business ventures

Moody’s stock price of $434.51 implies a valuation ratio of 25.5x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

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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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.