1 Cash-Heavy Stock with Exciting Potential and 2 Facing Headwinds

A cash-heavy balance sheet is often a sign of strength, but not always. Some companies avoid debt because they have weak business models, limited expansion opportunities, or inconsistent cash flow.

Financial flexibility is valuable, but it’s not everything - at StockStory, we help you find the stocks that can not only survive but also outperform. Keeping that in mind, here is one company with a net cash position that can continue growing sustainably and two with hidden risks.

Two Stocks to Sell:

EPAM (EPAM)

Net Cash Position: $878.7 million (9.9% of Market Cap)

Founded in 1993 during the early days of offshore software development, EPAM Systems (NYSE:EPAM) provides digital engineering, cloud, and AI transformation services to help global enterprises and startups modernize their technology systems and create digital products.

Why Are We Hesitant About EPAM?

1. Constant currency revenue growth has disappointed over the past two years and shows demand was soft
2. Incremental sales over the last two years were less profitable as its earnings per share were flat while its revenue grew
3. Waning returns on capital imply its previous profit engines are losing steam

At $159.40 per share, EPAM trades at 13.9x forward P/E. Check out our free in-depth research report to learn more about why EPAM doesn’t pass our bar.

First Bancorp (FBNC)

Net Cash Position: $666.1 million (30.4% of Market Cap)

Founded during the Great Depression in 1934 and originally known as Montgomery Bancorp, First Bancorp (NASDAQ:FBNC) is a community-oriented commercial bank providing a wide range of financial services to businesses and individuals in North and South Carolina.

Why Is FBNC Not Exciting?

1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 5% annually over the last two years
2. Concessions to defend its market share have ramped up over the last two years as its net interest margin decreased by 28.3 basis points (100 basis points = 1 percentage point)
3. Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 14.3% annually, worse than its revenue

First Bancorp is trading at $52.85 per share, or 1.4x forward P/B. Read our free research report to see why you should think twice about including FBNC in your portfolio.

One Stock to Watch:

Molina Healthcare (MOH)

Net Cash Position: $1.12 billion (13% of Market Cap)

Founded in 1980 as a provider for underserved communities in Southern California, Molina Healthcare (NYSE:MOH) provides managed healthcare services primarily to low-income individuals through Medicaid, Medicare, and Marketplace insurance programs across 21 states.

Why Could MOH Be a Winner?

1. Impressive 19.7% annual revenue growth over the last five years indicates it’s winning market share this cycle
2. Sizeable revenue base of $43.41 billion gives it economies of scale and favorable reimbursement terms with healthcare providers
3. Earnings per share have comfortably outperformed the peer group average over the last five years, increasing by 11.1% annually

Molina Healthcare’s stock price of $165.80 implies a valuation ratio of 6.8x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Growth Stocks for this month. 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 Exlservice (+354% 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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