2 Cash-Producing Stocks with Impressive Fundamentals and 1 Facing Challenges

Generating cash is essential for any business, but not all cash-rich companies are great investments. Some produce plenty of cash but fail to allocate it effectively, leading to missed opportunities.

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

One Stock to Sell:

DoubleVerify (DV)

Trailing 12-Month Free Cash Flow Margin: 19.2%

Using advanced analytics to evaluate over 17 billion digital ad transactions daily, DoubleVerify (NYSE:DV) provides AI-powered technology that verifies digital ads are viewable, fraud-free, brand-suitable, and displayed in the intended geographic location.

Why Does DV Give Us Pause?

1. Estimated sales growth of 9.3% for the next 12 months implies demand will slow from its two-year trend
2. Competitive market means the company must spend more on sales and marketing to stand out even if the return on investment is low
3. Operating margin declined by 1.8 percentage points over the last year as it scaled

DoubleVerify is trading at $9.25 per share, or 2x forward price-to-sales. Read our free research report to see why you should think twice about including DV in your portfolio.

Two Stocks to Buy:

Insulet (PODD)

Trailing 12-Month Free Cash Flow Margin: 16.8%

Revolutionizing diabetes care with its tubeless "Pod" technology, Insulet (NASDAQ:PODD) develops and manufactures innovative insulin delivery systems for people with diabetes, primarily through its Omnipod product line.

Why Do We Love PODD?

1. Average constant currency growth of 26% over the past two years demonstrates its ability to grow internationally despite currency fluctuations
2. Free cash flow margin expanded by 32.6 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
3. Returns on capital are climbing as management makes more lucrative bets

Insulet’s stock price of $241.94 implies a valuation ratio of 42.2x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.

Paymentus (PAY)

Trailing 12-Month Free Cash Flow Margin: 9.6%

Founded in 2004 to simplify the complex world of bill payments, Paymentus (NYSE:PAY) provides a cloud-based platform that helps utilities, municipalities, and service providers automate billing and payment processes.

Why Will PAY Beat the Market?

1. Market share has increased this cycle as its 39% annual revenue growth over the last two years was exceptional
2. Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 86.3% outpaced its revenue gains

At $24.74 per share, Paymentus trades at 34.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

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 9 Market-Beating Stocks. 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.