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. Keeping that in mind, here is one company with a net cash position that can leverage its balance sheet to grow and two that may struggle.

Two Stocks to Sell:

Asana (ASAN)

Net Cash Position: $225.5 million (16.5% of Market Cap)

Born from the founders' frustration with the inefficiencies of email-based collaboration at Facebook, Asana (NYSE: ASAN) provides a work management platform that helps organizations track projects, set goals, and manage workflows in a centralized digital workspace.

Why Is ASAN Risky?

1. Average billings growth of 9.4% over the last year was subpar, suggesting it struggled to push its software and might have to lower prices to stimulate demand
2. Customers have churned over the last year due to the commoditized nature of its software, as reflected in its 95.7% net revenue retention rate
3. Drawn-out sales process reflects its software’s integration hurdles with enterprise clients, restraining customer growth potential

Asana’s stock price of $5.74 implies a valuation ratio of 1.7x forward price-to-sales. Check out our free in-depth research report to learn more about why ASAN doesn’t pass our bar.

Markel Group (MKL)

Net Cash Position: $159.1 million (0.6% of Market Cap)

Often referred to as a "mini Berkshire Hathaway" for its three-engine business model of insurance, investments, and wholly-owned businesses, Markel Group (NYSE: MKL) is a specialty insurance company that underwrites complex risks, manages investment portfolios, and owns a diverse collection of operating businesses.

Why Are We Cautious About MKL?

1. Outsized scale creates growth headwinds as its 2.5% annualized net premiums earned increases over the last two years underperformed other financial institutions
2. Projected sales decline of 1.5% for the next 12 months points to a tough demand environment ahead
3. Estimated book value per share growth of 8.8% for the next 12 months implies profitability will slow from its two-year trend

At $1,957 per share, Markel Group trades at 1.2x forward P/B. If you’re considering MKL for your portfolio, see our FREE research report to learn more.

One Stock to Watch:

Freshworks (FRSH)

Net Cash Position: $810.5 million (35.9% of Market Cap)

Starting as a customer service solution before expanding into a comprehensive software suite, Freshworks (NASDAQ: FRSH) provides AI-powered software-as-a-service solutions that help companies manage customer service, IT support, sales, and marketing functions.

Why Are We Positive On FRSH?

1. ARR trends over the last year show it’s maintaining a steady flow of long-term contracts that contribute positively to its revenue predictability
2. Software is difficult to replicate at scale and results in a stellar gross margin of 85%
3. Operating profits increased over the last year as the company gained some leverage on its fixed costs and became more efficient

Freshworks is trading at $7.97 per share, or 2.4x forward price-to-sales. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum — both boxes checked at the same time.

Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.

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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.