3 Cash-Producing Stocks in the Doghouse

A company that generates cash isn’t automatically a winner. Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.

Not all companies are created equal, and StockStory is here to surface the ones with real upside. That said, here are three cash-producing companies to steer clear of and a few better alternatives.

VF Corp (VFC)

Trailing 12-Month Free Cash Flow Margin: 4%

Owner of The North Face, Vans, and Supreme, VF Corp (NYSE:VFC) is a clothing conglomerate specializing in branded lifestyle apparel, footwear, and accessories.

Why Do We Steer Clear of VFC?

1. Constant currency revenue growth has disappointed over the past two years and shows demand was soft
2. Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
3. 6× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings

VF Corp is trading at $12.47 per share, or 12.2x forward P/E. Read our free research report to see why you should think twice about including VFC in your portfolio.

Janus (JBI)

Trailing 12-Month Free Cash Flow Margin: 16.5%

Standing out with its digital keyless entry into self-storage room technology, Janus (NYSE:JBI) is a provider of easily accessible self-storage solutions.

Why Do We Pass on JBI?

1. Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
2. Projected sales decline of 4.9% over the next 12 months indicates demand will continue deteriorating
3. Earnings per share have contracted by 14.4% annually over the last three years, a headwind for returns as stock prices often echo long-term EPS performance

At $8 per share, Janus trades at 6x forward EV-to-EBITDA. If you’re considering JBI for your portfolio, see our FREE research report to learn more.

MSA Safety (MSA)

Trailing 12-Month Free Cash Flow Margin: 14%

Founded in 1914 as Mine Safety Appliances to protect coal miners from dangerous gases, MSA Safety (NYSE:MSA) designs and manufactures advanced safety products that protect workers and facilities across industries including fire service, energy, construction, and manufacturing.

Why Does MSA Give Us Pause?

1. Subscale operations are evident in its revenue base of $1.82 billion, meaning it has fewer distribution channels than its larger rivals
2. Estimated sales growth of 3.5% for the next 12 months implies demand will slow from its two-year trend
3. Free cash flow margin has shown no improvement over the last five years

MSA Safety’s stock price of $165.25 implies a valuation ratio of 19.9x forward P/E. Dive into our free research report to see why there are better opportunities than MSA.

Stocks We Like More

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free.