Generating cash is essential for any business, but not all cash-rich companies are great investments. Some produce plenty of cash but fail to allocate it effectively, leading to missed opportunities.
Luckily for you, we built StockStory to help you separate the good from the bad. That said, here is one cash-producing company that leverages its financial strength to beat its competitors and two that may struggle to keep up.
Two Stocks to Sell:
MillerKnoll (MLKN)
Trailing 12-Month Free Cash Flow Margin: 3%
Created through the 2021 merger of industry icons Herman Miller and Knoll, MillerKnoll (NASDAQ:MLKN) designs, manufactures, and distributes interior furnishings for offices, healthcare facilities, educational settings, and homes worldwide.
Why Should You Dump MLKN?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 2.1% annually over the last two years
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 1.2%
- Earnings per share fell by 7.2% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
At $16.53 per share, MillerKnoll trades at 8.7x forward P/E. Dive into our free research report to see why there are better opportunities than MLKN.
Tri Pointe Homes (TPH)
Trailing 12-Month Free Cash Flow Margin: 9.7%
Established in 2009 in California, Tri Pointe Homes (NYSE:TPH) is a United States homebuilder recognized for its innovative and sustainable approach to creating premium, life-enhancing homes.
Why Should You Sell TPH?
- Sales pipeline suggests its future revenue growth won’t meet our standards as its backlog averaged 7.6% declines over the past two years
- Forecasted revenue decline of 18.5% for the upcoming 12 months implies demand will fall even further
- Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 8.1% annually, worse than its revenue
Tri Pointe Homes’s stock price of $31.06 implies a valuation ratio of 14.1x forward P/E. If you’re considering TPH for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
Lyft (LYFT)
Trailing 12-Month Free Cash Flow Margin: 16.2%
Founded by Logan Green and John Zimmer as a long-distance intercity carpooling company Zimride, Lyft (NASDAQ: LYFT) operates a ridesharing network in the US and Canada.
Why Does LYFT Stand Out?
- Active Riders have grown by 10.3% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
- Incremental sales over the last three years have been highly profitable as its earnings per share increased by 39.2% annually, topping its revenue gains
- Free cash flow margin jumped by 23.7 percentage points over the last few years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
Lyft is trading at $19.16 per share, or 14.4x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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