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.
Just because a business has cash doesn’t mean it’s a good investment. Luckily, StockStory is here to help you separate the winners from the losers. Keeping that in mind, here are two companies with net cash positions that can continue growing sustainably and one best left off your watchlist.
One Stock to Sell:
Origin Bancorp (OBK)
Net Cash Position: $625.8 million (43.8% of Market Cap)
Founded in 1912 during the early boom days of Louisiana banking, Origin Bancorp (NYSE: OBK) is a financial holding company that provides personalized banking services to businesses, municipalities, and individuals across Texas, Louisiana, and Mississippi.
Why Does OBK Give Us Pause?
- Muted 8.2% annual revenue growth over the last five years shows its demand lagged behind its banking peers
- Annual earnings per share growth of 6.8% underperformed its revenue over the last five years, showing its incremental sales were less profitable
- Estimated tangible book value per share growth of 8.1% for the next 12 months implies profitability will slow from its two-year trend
Origin Bancorp’s stock price of $46.16 implies a valuation ratio of 1.1x forward P/B. Check out our free in-depth research report to learn more about why OBK doesn’t pass our bar.
Two Stocks to Watch:
Veeva Systems (VEEV)
Net Cash Position: $6.46 billion (24.8% of Market Cap)
Originally named "Verticals onDemand" before rebranding in 2009, Veeva Systems (NYSE: VEEV) provides cloud software, data solutions, and consulting services that help life sciences companies develop and bring products to market more efficiently.
Why Are We Positive On VEEV?
- User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
- Healthy operating margin of 28.7% shows it’s a well-run company with efficient processes, and its operating leverage amplified its profits over the last year
- Robust free cash flow margin of 43.4% gives it many options for capital deployment
Veeva Systems is trading at $159.50 per share, or 7.8x forward price-to-sales. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Toast (TOST)
Net Cash Position: $1.74 billion (12.4% of Market Cap)
Born from the frustrations of three friends waiting too long for their restaurant bill, Toast (NYSE: TOST) provides a cloud-based digital technology platform with software, payment processing, and hardware solutions built specifically for restaurants.
Why Does TOST Stand Out?
- Ability to secure long-term commitments with customers is evident in its 28% ARR growth over the last year
- Projected revenue growth of 19.6% for the next 12 months suggests its momentum from the last two years will persist
At $24.29 per share, Toast trades at 2x forward price-to-sales. 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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
