2 Cash-Producing Stocks to Consider Right Now and 1 Facing Headwinds

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.

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 reinvest wisely to drive long-term success and one that may face some trouble.

One Healthcare Stock to Sell:

Supernus Pharmaceuticals (SUPN)

Trailing 12-Month Free Cash Flow Margin: 10.4%

With a diverse portfolio of eight FDA-approved medications targeting neurological conditions, Supernus Pharmaceuticals (NASDAQ:SUPN) develops and markets treatments for central nervous system disorders including epilepsy, ADHD, Parkinson's disease, and migraine.

Why Do We Pass on SUPN?

1. Sales trends were unexciting over the last five years as its 5.9% annual growth was below the typical healthcare company
2. Modest revenue base of $681.5 million gives it less fixed cost leverage and fewer distribution channels than larger companies
3. Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions

At $48.25 per share, Supernus Pharmaceuticals trades at 19.4x forward P/E. Read our free research report to see why you should think twice about including SUPN in your portfolio.

Two Healthcare Stocks to Watch:

Natera (NTRA)

Trailing 12-Month Free Cash Flow Margin: 5%

Founded in 2003 as Gene Security Network before rebranding in 2012, Natera (NASDAQ:NTRA) develops and commercializes genetic tests for prenatal screening, cancer detection, and organ transplant monitoring using its proprietary cell-free DNA technology.

Why Will NTRA Beat the Market?

1. Products are seeing elevated demand as its tests processed averaged 19.6% growth over the past two years
2. Adjusted operating margin improvement of 32 percentage points over the last two years demonstrates its ability to scale efficiently
3. Free cash flow flipped to positive over the last five years, indicating the company has achieved financial self-sustainability

Natera’s stock price of $241.60 implies a valuation ratio of 13.2x forward price-to-sales. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Stryker (SYK)

Trailing 12-Month Free Cash Flow Margin: 16.7%

With over 150 million patients impacted annually through its innovative healthcare technologies, Stryker (NYSE:SYK) develops and manufactures advanced medical devices and equipment across orthopedics, surgical tools, neurotechnology, and patient care solutions.

Why Does SYK Stand Out?

1. Core business is healthy and doesn’t need acquisitions to boost sales as its organic revenue growth averaged 10.2% over the past two years
2. $24.38 billion in revenue gives its scale, which leads to bargaining power with customers because there are few trusted alternatives
3. Earnings growth has massively outpaced its peers over the last five years as its EPS has compounded at 13.1% annually

Stryker is trading at $352.80 per share, or 24.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.