A cash-heavy balance sheet is often a sign of strength, but not always. Some companies avoid debt because they have weak business models, limited expansion opportunities, or inconsistent cash flow.
Just because a business has cash doesn’t mean it’s a good investment. Luckily, StockStory is here to help you separate the winners from the losers. That said, here is one company with a net cash position that can continue growing sustainably and two with hidden risks.
Two Stocks to Sell:
DoubleVerify (DV)
Net Cash Position: $97.62 million (5.3% of Market Cap)
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 Worry Us?
- Estimated sales growth of 9.3% for the next 12 months implies demand will slow from its two-year trend
- Long payback periods on sales and marketing expenses limit customer growth and signal the company operates in a highly competitive environment
- Operating margin dropped by 1.8 percentage points over the last year as the company focused on expansion rather than profitability
DoubleVerify’s stock price of $11.57 implies a valuation ratio of 2.4x forward price-to-sales. To fully understand why you should be careful with DV, check out our full research report (it’s free for active Edge members).
Eastern Bank (EBC)
Net Cash Position: $215.3 million (4.9% of Market Cap)
Founded in 1818 as one of America's oldest mutual banks before converting to a public company in 2020, Eastern Bankshares (NASDAQ: EBC) operates as a bank holding company providing commercial and retail banking services primarily in Massachusetts, New Hampshire, and Rhode Island.
Why Are We Cautious About EBC?
- Inferior net interest margin of 3.1% means it must compensate for lower profitability through increased loan originations
- Projected tangible book value per share decline of 3.5% for the next 12 months points to tough credit quality challenges ahead
- ROE of 1.9% reflects management’s challenges in identifying attractive investment opportunities
At $18.43 per share, Eastern Bank trades at 1.1x forward P/B. Read our free research report to see why you should think twice about including EBC in your portfolio.
One Stock to Buy:
LendingClub (LC)
Net Cash Position: $823.9 million (37.7% of Market Cap)
Pioneering peer-to-peer lending in the US before evolving into a digital bank, LendingClub (NYSE: LC) operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.
Why Is LC a Top Pick?
- Impressive 24.7% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Earnings per share grew by 38.3% annually over the last two years and trumped its peers
LendingClub is trading at $18.94 per share, or 12.8x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
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 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.
