1 Cash-Producing Stock Worth Your Attention and 2 We Ignore

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.

Cash flow is valuable, but it’s not everything - StockStory helps you identify the companies that truly put it to work. Keeping that in mind, here is one cash-producing company that excels at turning cash into shareholder value and two that may face some trouble.

Two Stocks to Sell:

Manhattan Associates (MANH)

Trailing 12-Month Free Cash Flow Margin: 31.2%

Built on a "versionless" cloud architecture that delivers quarterly updates to all customers, Manhattan Associates (NASDAQ:MANH) develops cloud-based software that helps retailers, wholesalers, and manufacturers manage their supply chains, inventory, and omnichannel operations.

Why Does MANH Give Us Pause?

1. Customers had second thoughts about committing to its platform over the last year as its average billings growth of 5% underwhelmed
2. Estimated sales growth of 5% for the next 12 months implies demand will slow from its two-year trend
3. Gross margin of 56.5% reflects its high servicing costs

Manhattan Associates is trading at $168.44 per share, or 9.2x forward price-to-sales. Dive into our free research report to see why there are better opportunities than MANH.

eXp World (EXPI)

Trailing 12-Month Free Cash Flow Margin: 2.4%

Founded in 2009, eXp World (NASDAQ:EXPI) is a real estate company known for its virtual, cloud-based approach to real estate brokerage.

Why Do We Avoid EXPI?

1. Sluggish trends in its transactions suggest customers aren’t adopting its solutions as quickly as the company hoped
2. Subpar operating margin of -0.5% constrains its ability to invest in process improvements or effectively respond to new competitive threats
3. Earnings per share fell by 25% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable

eXp World’s stock price of $10.50 implies a valuation ratio of 22.5x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why EXPI doesn’t pass our bar.

One Stock to Buy:

Medpace (MEDP)

Trailing 12-Month Free Cash Flow Margin: 28.7%

Founded in 1992 as a scientifically-driven alternative to traditional contract research organizations, Medpace (NASDAQ:MEDP) provides outsourced clinical trial management and research services to help pharmaceutical, biotechnology, and medical device companies develop new treatments.

Why Do We Love MEDP?

1. Core business is healthy and doesn’t need acquisitions to boost sales as its organic revenue growth averaged 15.1% over the past two years
2. Share repurchases over the last five years enabled its annual earnings per share growth of 34.2% to outpace its revenue gains
3. Stellar returns on capital showcase management’s ability to surface highly profitable business ventures

At $592.55 per share, Medpace trades at 37.1x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free for active Edge members.

Stocks We Like Even More

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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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