A company that generates cash isn’t automatically a winner. Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.
Not all companies are created equal, and StockStory is here to surface the ones with real upside. That said, here are two cash-producing companies that excel at turning cash into shareholder value and one that may face some trouble.
One Stock to Sell:
Knight-Swift Transportation (KNX)
Trailing 12-Month Free Cash Flow Margin: 10.4%
Covering 1.6 billion loaded miles in 2023 alone, Knight-Swift Transportation (NYSE: KNX) offers less-than-truckload and full truckload delivery services.
Why Do We Avoid KNX?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 17.5% annually
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $68.68 per share, Knight-Swift Transportation trades at 21.4x forward P/E. If you’re considering KNX for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Workiva (WK)
Trailing 12-Month Free Cash Flow Margin: 20.8%
Nicknamed "the Excel killer" by some finance professionals for its ability to eliminate spreadsheet chaos, Workiva (NYSE: WK) provides a cloud-based platform that enables organizations to streamline financial reporting, ESG, and compliance processes with connected data and automation.
Why Are We Fans of WK?
- Ability to secure long-term commitments with customers is evident in its 21.1% ARR growth over the last year
- Software is difficult to replicate at scale and leads to a stellar gross margin of 80.2%
- Free cash flow margin of 20.8% is higher than many in the industry, giving it breathing room and optionality
Workiva is trading at $67.37 per share, or 3.3x forward price-to-sales. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Taboola (TBLA)
Trailing 12-Month Free Cash Flow Margin: 10.2%
Often appearing as those "You May Also Like" or "Recommended For You" boxes at the bottom of news articles, Taboola (NASDAQ: TBLA) operates a digital platform that recommends personalized content to users across publisher websites, helping both publishers monetize their sites and advertisers reach target audiences.
Why Are We Positive on TBLA?
- Impressive 10% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Free cash flow margin increased by 8.4 percentage points over the last five years, giving the company more capital to invest or return to shareholders
- Returns on capital are increasing as management’s prior bets are starting to bear fruit
Taboola’s stock price of $4.18 implies a valuation ratio of 5.6x forward P/E. Is now a good 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.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum 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-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
