1 Cash-Burning Stock for Long-Term Investors 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.

Just because a company is spending heavily doesn’t mean it’s on the right track, and StockStory is here to separate the winners from the losers. That said, here is one high-risk, high-reward company with the potential to scale into a market leader and two that could run into serious trouble.

Two Stocks to Sell:

Graphic Packaging Holding (GPK)

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

Founded in 1991, Graphic Packaging (NYSE:GPK) is a provider of paper-based packaging solutions for a wide range of products.

Why Do We Avoid GPK?

1. Declining unit sales over the past two years suggest it might have to lower prices to accelerate growth
2. Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
3. 8.9 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position

Graphic Packaging Holding’s stock price of $16.07 implies a valuation ratio of 7.8x forward P/E. If you’re considering GPK for your portfolio, see our FREE research report to learn more.

STAAR Surgical (STAA)

Trailing 12-Month Free Cash Flow Margin: -19.5%

With over 2.5 million implants performed worldwide, STAAR Surgical (NASDAQ:STAA) designs and manufactures implantable lenses that correct vision problems without removing the eye's natural lens.

Why Should You Dump STAA?

1. Underwhelming constant currency revenue performance over the past two years suggests its product offering at current prices doesn’t resonate with customers
2. Free cash flow margin dropped by 35.2 percentage points over the last five years, implying the company became more capital intensive as competition picked up
3. Eroding returns on capital suggest its historical profit centers are aging

STAAR Surgical is trading at $26.57 per share, or 61.6x forward P/E. Check out our free in-depth research report to learn more about why STAA doesn’t pass our bar.

One Stock to Watch:

Charles Schwab (SCHW)

Trailing 12-Month Free Cash Flow Margin: -8.7%

Founded in 1971 as a disruptive force challenging Wall Street's high fees and limited access, Charles Schwab (NYSE:SCHW) is a wealth management and brokerage firm that provides investment services, banking, and financial advice to individual investors and independent advisors.

Why Should SCHW Be on Your Watchlist?

1. Annual revenue growth of 17.8% over the last five years was superb and indicates its market share increased during this cycle
2. Earnings per share have outperformed the peer group average over the last five years, increasing by 14.5% annually
3. Market-beating return on equity illustrates that management has a knack for investing in profitable ventures

At $93.78 per share, Charles Schwab trades at 17.4x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free for active Edge members .

Stocks We Like Even More

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 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-micro-cap company Tecnoglass (+1,754% 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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