Companies with more cash than debt can be financially resilient, but that doesn’t mean they’re all strong investments. Some lack leverage because they struggle to grow or generate consistent profits, making them unattractive borrowers.
Not all businesses with cash are winners, and that’s why we built StockStory - to help you separate the good from the bad. Keeping that in mind, here are three companies with net cash positions that don’t make the cut and some better choices instead.
Moderna (MRNA)
Net Cash Position: $3.91 billion (18.1% of Market Cap)
Rising to global prominence during the COVID-19 pandemic with one of the first effective vaccines, Moderna (NASDAQ: MRNA) develops messenger RNA (mRNA) medicines that direct the body's cells to produce proteins with therapeutic or preventive benefits for various diseases.
Why Are We Out on MRNA?
- Annual sales declines of 34.3% for the past two years show its products and services struggled to connect with the market during this cycle
- Performance over the past five years shows each sale was less profitable as its earnings per share dropped by 46.5% annually, worse than its revenue
- 129.7 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
Moderna’s stock price of $56.35 implies a valuation ratio of 10x forward price-to-sales. To fully understand why you should be careful with MRNA, check out our full research report (it’s free).
Korn Ferry (KFY)
Net Cash Position: $549 million (15.6% of Market Cap)
With clients including 97% of the S&P 100 and operations in 103 offices across 51 countries, Korn Ferry (NYSE: KFY) is a global consulting firm that helps organizations design optimal structures, recruit talent, develop leaders, and create effective compensation strategies.
Why Is KFY Not Exciting?
- Flat sales over the last two years suggest it must find different ways to grow during this cycle
- Free cash flow margin dropped by 5.3 percentage points over the last five years, implying the company became more capital intensive as competition picked up
- Diminishing returns on capital suggest its earlier profit pools are drying up
At $67.78 per share, Korn Ferry trades at 12x forward P/E. Check out our free in-depth research report to learn more about why KFY doesn’t pass our bar.
FirstSun Capital Bancorp (FSUN)
Net Cash Position: $245.1 million (14.1% of Market Cap)
Tracing its roots back to 1892 when it first opened its doors in Kansas, FirstSun Capital Bancorp (NASDAQ: FSUN) operates Sunflower Bank, providing commercial and consumer banking services to businesses and individuals across the Southwest region.
Why Are We Wary of FSUN?
- Sales trends were unexciting over the last five years as its 7.4% annual growth was below the typical banking company
- Projected tangible book value per share decline of 2.8% for the next 12 months points to tough credit quality challenges ahead
- ROE of 9% reflects management’s challenges in identifying attractive investment opportunities
FirstSun Capital Bancorp is trading at $37.07 per share, or 0.9x forward P/B. Dive into our free research report to see why there are better opportunities than FSUN.
Stocks We Like More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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 Kadant (+351% five-year return). Find your next big winner with StockStory today.
