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

Luckily for you, we built StockStory to help you separate the good from the bad. Keeping that in mind, here are three cash-producing companies that don’t make the cut and some better opportunities instead.

MGP Ingredients (MGPI)

Trailing 12-Month Free Cash Flow Margin: 10.1%

Headquartered in Atchison, Kansas, MGP Ingredients (NASDAQ: MGPI) is a leading supplier of high-quality ingredients to the food and beverage industry

Why Do We Pass on MGPI?

1. Annual sales declines of 12.9% for the past three years show its products struggled to connect with the market
2. Operating profits fell over the last year as its sales dropped and it struggled to adjust its fixed costs
3. Earnings per share have dipped by 17.4% annually over the past three years, which is concerning because stock prices follow EPS over the long term

MGP Ingredients is trading at $16.98 per share, or 9.3x forward P/E. Check out our free in-depth research report to learn more about why MGPI doesn’t pass our bar.

Ball (BALL)

Trailing 12-Month Free Cash Flow Margin: 4.4%

Started with a $200 loan in 1880, Ball (NYSE: BLL) manufactures aluminum packaging for beverages, personal care, and household products as well as aerospace systems and other technologies.

Why Does BALL Give Us Pause?

1. Sales stagnated over the last two years and signal the need for new growth strategies
2. High input costs result in an inferior gross margin of 21.3% that must be offset through higher volumes
3. Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of -0.3% for the last five years

At $63.39 per share, Ball trades at 15.6x forward P/E. To fully understand why you should be careful with BALL, check out our full research report (it’s free).

LifeStance Health Group (LFST)

Trailing 12-Month Free Cash Flow Margin: 9.5%

With over 6,600 licensed mental health professionals treating more than 880,000 patients annually, LifeStance Health (NASDAQ: LFST) provides outpatient mental health services through a network of clinicians offering psychiatric evaluations, psychological testing, and therapy across 33 states.

Why Does LFST Fall Short?

1. Modest revenue base of $1.49 billion gives it less fixed cost leverage and fewer distribution channels than larger companies
2. Poor free cash flow margin of 0.9% for the last five years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
3. Negative returns on capital show that some of its growth strategies have backfired

LifeStance Health Group’s stock price of $11.26 implies a valuation ratio of 34.1x forward P/E. If you’re considering LFST for your portfolio, see our FREE research report to learn more.

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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.