2 Cash-Producing Stocks to Consider Right Now and 1 We Brush Off
While strong cash flow is a key indicator of stability, it doesn’t always translate to superior returns. Some cash-heavy businesses struggle with inefficient spending, slowing demand, or weak competitive positioning.
Luckily for you, we built StockStory to help you separate the good from the bad. Keeping that in mind, here are two cash-producing companies that excel at turning cash into shareholder value and one best left off your watchlist.
One Stock to Sell:
Nature's Sunshine (NATR)
Trailing 12-Month Free Cash Flow Margin: 3.7%
Started on a kitchen table in Utah, Nature’s Sunshine (NASDAQ:NATR) manufactures and sells nutritional and personal care products.
Why Does NATR Fall Short?
- 4.4% annual revenue growth over the last three years was slower than its consumer staples peers
- Revenue base of $492 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale
- Estimated sales growth of 2.8% for the next 12 months implies demand will slow from its three-year trend
Nature's Sunshine is trading at $14.28 per share, or 12.9x forward P/E. If you’re considering NATR for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Freshworks (FRSH)
Trailing 12-Month Free Cash Flow Margin: 25.1%
Starting as a customer service solution before expanding into a comprehensive software suite, Freshworks (NASDAQ:FRSH) provides AI-powered software-as-a-service solutions that help companies manage customer service, IT support, sales, and marketing functions.
Why Could FRSH Be a Winner?
- Annual revenue growth of 24% over the last five years beat the sector average and indicates its software solves complex business issues
- Software is difficult to replicate at scale and results in a stellar gross margin of 85%
- Robust free cash flow margin of 25.1% gives it many options for capital deployment
At $13.35 per share, Freshworks trades at 3.6x forward price-to-sales. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Allstate (ALL)
Trailing 12-Month Free Cash Flow Margin: 18.1%
Born from a Sears, Roebuck & Co. initiative during the Great Depression with its famous "You're in good hands" slogan, Allstate (NYSE:ALL) is one of America's largest personal property and casualty insurers, offering protection for autos, homes, and personal property.
Why Are We Fans of ALL?
- Pre-tax profit margin improvement of 18.4 percentage points over the last two years demonstrates its ability to scale efficiently
- Share buybacks catapulted its annual earnings per share growth to 83.7%, which outperformed its revenue gains over the last two years
- Balance sheet strength has increased this cycle as its 40.9% annual book value per share growth over the last two years was exceptional
Allstate’s stock price of $259.36 implies a valuation ratio of 1.9x forward P/B. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.