2 Cash-Producing Stocks to Target This Week and 1 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.

Luckily for you, we built StockStory to help you separate the good from the bad. That said, here are two cash-producing companies that leverage their financial strength to beat the competition and one best left off your watchlist.

One Stock to Sell:

Repligen (RGEN)

Trailing 12-Month Free Cash Flow Margin: 15.5%

With over 13 strategic acquisitions since 2012 to build its comprehensive bioprocessing portfolio, Repligen (NASDAQ:RGEN) develops and manufactures specialized technologies that improve the efficiency and flexibility of biological drug manufacturing processes.

Why Should You Dump RGEN?

1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
2. Costs have risen faster than its revenue over the last five years, causing its adjusted operating margin to decline by 17.8 percentage points
3. Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions

At $159.56 per share, Repligen trades at 85x forward P/E. Read our free research report to see why you should think twice about including RGEN in your portfolio.

Two Stocks to Watch:

Urban Outfitters (URBN)

Trailing 12-Month Free Cash Flow Margin: 6.7%

Founded as a purveyor of vintage items, Urban Outfitters (NASDAQ:URBN) now largely sells new apparel and accessories to teens and young adults seeking on-trend fashion.

Why Do We Like URBN?

1. Comparable store sales rose by 4.6% on average over the past two years, demonstrating its ability to drive increased spending at existing locations
2. Forecasted revenue growth of 8.4% for the next 12 months suggests stronger momentum versus most peers
3. Share repurchases over the last three years enabled its annual earnings per share growth of 41.8% to outpace its revenue gains

Urban Outfitters is trading at $69.60 per share, or 12.5x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

Merck (MRK)

Trailing 12-Month Free Cash Flow Margin: 20.3%

With roots dating back to 1891 and a portfolio that includes the blockbuster cancer immunotherapy Keytruda, Merck (NYSE:MRK) develops and sells prescription medicines, vaccines, and animal health products across oncology, infectious diseases, cardiovascular, and other therapeutic areas.

Why Will MRK Outperform?

1. Unparalleled scale of $64.23 billion in revenue gives it negotiating leverage and staying power in an industry with high barriers to entry
2. Adjusted operating profits and efficiency rose over the last two years as it benefited from some fixed cost leverage
3. Robust free cash flow margin of 22.1% gives it many options for capital deployment, and its improved cash conversion implies it’s becoming a less capital-intensive business

Merck’s stock price of $106.74 implies a valuation ratio of 20.7x 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

If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.

Don’t wait for the next volatility shock. 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 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.