A company that generates cash isn’t automatically a winner. Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.
Cash flow is valuable, but it’s not everything - StockStory helps you identify the companies that truly put it to work. That said, here is one cash-producing company that reinvests wisely to drive long-term success and two best left off your watchlist.
Two Stocks to Sell:
JLL (JLL)
Trailing 12-Month Free Cash Flow Margin: 3.6%
Founded in 1999 through the merger of Jones Lang Wootton and LaSalle Partners, JLL (NYSE: JLL) is a company specializing in real estate advisory and investment management services.
Why Is JLL Risky?
- Annual sales growth of 8.1% over the last five years lagged behind its consumer discretionary peers as its large revenue base made it difficult to generate incremental demand
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 2.8% for the last two years
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
JLL’s stock price of $346.50 implies a valuation ratio of 17.5x forward P/E. Check out our free in-depth research report to learn more about why JLL doesn’t pass our bar.
Omnicell (OMCL)
Trailing 12-Month Free Cash Flow Margin: 9.5%
Driven by the vision of an "Autonomous Pharmacy" with zero medication errors, Omnicell (NASDAQ: OMCL) provides medication management automation and adherence tools that help healthcare systems and pharmacies reduce errors and improve efficiency.
Why Do We Pass on OMCL?
- Flat sales over the last two years suggest it must find different ways to grow during this cycle
- Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 9.5 percentage points
- Earnings per share fell by 5.4% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
At $45.74 per share, Omnicell trades at 25.9x forward P/E. Dive into our free research report to see why there are better opportunities than OMCL.
One Stock to Buy:
Abercrombie and Fitch (ANF)
Trailing 12-Month Free Cash Flow Margin: 7.4%
Founded as an outdoor and sporting brand, Abercrombie & Fitch (NYSE: ANF) evolved to become a specialty retailer that sells its own brand of fashionable clothing to young adults.
Why Should You Buy ANF?
- Comparable store sales rose by 11.9% on average over the past two years, demonstrating its ability to drive increased spending at existing locations
- Collection of products is difficult to replicate at scale and results in a best-in-class gross margin of 63.3%
- Share buybacks catapulted its annual earnings per share growth to 189%, which outperformed its revenue gains over the last three years
Abercrombie and Fitch is trading at $126.84 per share, or 12.2x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.
