A clean balance sheet can signal disciplined management and stability. It also means a company can expand and thrive without relying on borrowed capital.
Even among the companies with sound capital structures, only a few stand out, and we’re here to help you identify them. That said, here are three companies with net cash positions that can leverage their balance sheets to grow.
HubSpot (HUBS)
Net Cash Position: $1.44 billion (15.1% of Market Cap)
Born from the idea that traditional interruptive marketing was becoming less effective, HubSpot (NYSE: HUBS) provides an integrated platform that helps businesses attract, engage, and manage customer relationships through marketing, sales, service, and content management tools.
Why Are We Positive on HUBS?
- Winning new contracts that can potentially increase in value as its billings growth has averaged 22.3% over the last year
- Superior software functionality and low servicing costs result in a top-tier gross margin of 83.7%
- Software platform has product-market fit given the rapid recovery of its customer acquisition costs
HubSpot’s stock price of $202.00 implies a valuation ratio of 2.7x forward price-to-sales. Is now a good time to buy? See for yourself in our full research report, it’s free.
SentinelOne (S)
Net Cash Position: $651.7 million (12.9% of Market Cap)
Built on the principle of "fighting machine with machine," SentinelOne (NYSE: S) provides an AI-powered cybersecurity platform that autonomously prevents, detects, and responds to threats across endpoints, cloud workloads, and identity systems.
Why Are We Fans of S?
- Ability to secure long-term commitments with customers is evident in its 22.8% ARR growth over the last year
- Sales outlook for the upcoming 12 months implies the business will stay on its desirable two-year growth trajectory
- Free cash flow margin is forecasted to grow by 7.8 percentage points in the coming year, potentially giving the company more chips to play with
At $18.05 per share, SentinelOne trades at 4.9x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
Happen Bank (HAPN)
Net Cash Position: $797.5 million (37.9% of Market Cap)
Pioneering peer-to-peer lending in the US before evolving into a digital bank, Happen Bank (NYSE: HAPN) operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.
Why Will HAPN Beat the Market?
- Annual revenue growth of 28.7% over the past five years was outstanding, reflecting market share gains this cycle
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 109% annually, topping its revenue gains
- Adequate return on equity shows management makes decent investment decisions
Happen Bank is trading at $19.42 per share, or 11.1x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
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