3 Cash-Heavy Stocks That Fall Short

A surplus of cash can mean financial stability, but it can also indicate a reluctance (or inability) to invest in growth. Some of these companies also face challenges like stagnating revenue, declining market share, or limited scalability.

Financial flexibility is valuable, but it’s not everything - at StockStory, we help you find the stocks that can not only survive but also outperform. Keeping that in mind, here are three companies with net cash positions that don’t make the cut and some better choices instead.

Tutor Perini (TPC)

Net Cash Position: $580 million (15.1% of Market Cap)

Known for constructing the Philadelphia Eagles’ Stadium, Tutor Perini (NYSE:TPC) is a civil and building construction company offering diversified general contracting and design-build services.

Why Do We Think Twice About TPC?

1. Flat sales over the last five years suggest it must find different ways to grow during this cycle
2. Gross margin of 6.7% is below its competitors, leaving less money to invest in areas like marketing and R&D
3. Below-average returns on capital indicate management struggled to find compelling investment opportunities

Tutor Perini is trading at $74.20 per share, or 14.4x forward P/E. Read our free research report to see why you should think twice about including TPC in your portfolio.

Penumbra (PEN)

Net Cash Position: $325.1 million (2.4% of Market Cap)

Founded in 2004 to address challenging medical conditions with significant unmet needs, Penumbra (NYSE:PEN) develops and manufactures innovative medical devices for treating vascular diseases and providing immersive healthcare rehabilitation solutions.

Why Does PEN Give Us Pause?

1. Subscale operations are evident in its revenue base of $1.40 billion, meaning it has fewer distribution channels than its larger rivals
2. Low returns on capital reflect management’s struggle to allocate funds effectively

At $338.68 per share, Penumbra trades at 67.2x forward P/E. Dive into our free research report to see why there are better opportunities than PEN.

Centene (CNC)

Net Cash Position: $291 million (1.4% of Market Cap)

Serving nearly 1 in 15 Americans through its government healthcare programs, Centene (NYSE:CNC) is a healthcare company that manages government-sponsored health insurance programs like Medicaid and Medicare for low-income and complex-needs populations.

Why Are We Wary of CNC?

1. Underwhelming customer growth over the past two years shows the company faced challenges in winning new contracts
2. Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 16.3% annually
3. Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned

Centene’s stock price of $43.00 implies a valuation ratio of 14.2x forward P/E. If you’re considering CNC for your portfolio, see our FREE research report to learn more.

Stocks We Like More

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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 Kadant (+351% five-year return). Find your next big winner with StockStory today.