1 Cash-Burning Stock Worth Your Attention and 2 We Turn Down

Companies that burn cash at a rapid pace can run into serious trouble if they fail to secure funding. Without a clear path to profitability, these businesses risk dilution, mounting debt, or even bankruptcy.

Not all companies are worth the risk, and that’s why we built StockStory - to help you spot the red flags. Keeping that in mind, here is one high-risk, high-reward company that could turn today’s losses into tomorrow’s gains and two that could run into serious trouble.

Two Industrials Stocks to Sell:

Plug Power (PLUG)

Trailing 12-Month Free Cash Flow Margin: -140%

Powering forklifts for Walmart’s distribution centers, Plug Power (NASDAQ:PLUG) provides hydrogen fuel cells used to power electric motors.

Why Is PLUG Risky?

1. Sales tumbled by 8.7% annually over the last two years, showing market trends are working against its favor during this cycle
2. Free cash flow margin shrank by 531.2 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
3. Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution

Plug Power is trading at $1.48 per share, or 1.8x forward price-to-sales. To fully understand why you should be careful with PLUG, check out our full research report (it’s free).

Rivian (RIVN)

Trailing 12-Month Free Cash Flow Margin: -23.7%

The manufacturer of Amazon’s delivery trucks, Rivian (NASDAQ:RIVN) designs, manufactures, and sells electric vehicles and commercial delivery vans.

Why Is RIVN Not Exciting?

1. Negative 49.3% gross margin means it loses money on every sale and must pivot or scale quickly to survive
2. Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
3. Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders

At $11.70 per share, Rivian trades at 2.3x forward price-to-sales. Read our free research report to see why you should think twice about including RIVN in your portfolio.

One Industrials Stock to Buy:

Graham Corporation (GHM)

Trailing 12-Month Free Cash Flow Margin: -4.5%

Founded when its founder patented a unique design for a vacuum system used in the sugar refining process, Graham (NYSE:GHM) provides vacuum and heat transfer equipment for the energy, petrochemical, refining, and chemical sectors.

Why Is GHM a Top Pick?

1. Demand is greater than supply as the company’s 21.7% average backlog growth over the past two years shows it’s securing new contracts and accumulating more orders than it can fulfill
2. Operating margin improvement of 4.4 percentage points over the last five years demonstrates its ability to scale efficiently
3. Incremental sales over the last two years have been highly profitable as its earnings per share increased by 145% annually, topping its revenue gains

Graham Corporation’s stock price of $49.08 implies a valuation ratio of 28.2x forward EV-to-EBITDA. Is now the time to initiate a position? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

When Trump unveiled his aggressive tariff plan in April 2024, 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 5 Strong Momentum Stocks for this week. 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-small-cap company Comfort Systems (+782% 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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.