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 is one company with a net cash position that balances growth with stability and two that may struggle.
Two Stocks to Sell:
Lincoln Financial Group (LNC)
Net Cash Position: $976 million (13.9% of Market Cap)
Founded in 1905 by a group of Fort Wayne, Indiana businessmen who named the company after Abraham Lincoln, Lincoln National Corporation (NYSE: LNC) provides insurance, retirement plans, and wealth management products through its subsidiaries, operating under four main segments: Annuities, Life Insurance, Group Protection, and Retirement Plan Services.
Why Does LNC Fall Short?
- Net premiums earned remained stagnant over the last five years, indicating expansion challenges this cycle
- Estimated sales growth of 2.6% for the next 12 months implies demand will slow from its two-year trend
- Products and services are facing significant credit quality challenges during this cycle as book value per share has declined by 14% annually over the last five years
Lincoln Financial Group’s stock price of $37.25 implies a valuation ratio of 0.7x forward P/B. Read our free research report to see why you should think twice about including LNC in your portfolio.
Peabody Energy (BTU)
Net Cash Position: $157.3 million (4.9% of Market Cap)
Beginning with a single wagon hauling coal in Illinois back when Grover Cleveland was president, Peabody Energy (NYSE: BTU) mines coal used by electricity generators and steel manufacturers.
Why Do We Steer Clear of BTU?
- Sales tumbled by 2.7% annually over the last ten years, showing market trends are working against it during this cycle
- Gross margin of 24.9% reflects its high production costs and unfavorable asset base
- Day-to-day expenses have swelled relative to revenue over the last five years as its EBITDA margin fell by 25.1 percentage points
Peabody Energy is trading at $27.75 per share, or 13.6x forward P/E. To fully understand why you should be careful with BTU, check out our full research report (it’s free).
One Stock to Buy:
Natera (NTRA)
Net Cash Position: $862.7 million (2.7% of Market Cap)
Founded in 2003 as Gene Security Network before rebranding in 2012, Natera (NASDAQ: NTRA) develops and commercializes genetic tests for prenatal screening, cancer detection, and organ transplant monitoring using its proprietary cell-free DNA technology.
Why Are We Bullish on NTRA?
- Products are seeing elevated demand as its tests processed averaged 19.4% growth over the past two years
- Adjusted operating margin expanded by 15.7 percentage points over the last two years as it scaled and became more efficient
- Free cash flow flipped to positive over the last five years, showing the company has crossed a key inflection point
At $212.42 per share, Natera trades at 10.7x forward price-to-sales. Is now the right time to buy? 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.
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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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
