While strong cash flow is a key indicator of stability, it doesn’t always translate to superior returns. Some cash-heavy businesses struggle with inefficient spending, slowing demand, or weak competitive positioning.

Not all companies are created equal, and StockStory is here to surface the ones with real upside. Keeping that in mind, here are two cash-producing companies that leverage their financial strength to beat the competition and one that may face some trouble.

One Stock to Sell:

Revvity (RVTY)

Trailing 12-Month Free Cash Flow Margin: 17.8%

Formerly known as PerkinElmer until its rebranding in 2023, Revvity (NYSE: RVTY) provides health science technologies and services that support the complete workflow from discovery to development and diagnosis to cure.

Why Are We Out on RVTY?

1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
2. Overall productivity fell over the last five years as its plummeting sales were accompanied by a decline in its adjusted operating margin
3. Earnings per share decreased by more than its revenue over the last five years, showing each sale was less profitable

Revvity is trading at $95.59 per share, or 18.2x forward P/E. To fully understand why you should be careful with RVTY, check out our full research report (it’s free).

Two Stocks to Watch:

Acuity Brands (AYI)

Trailing 12-Month Free Cash Flow Margin: 11.8%

One of the pioneers of smart lights, Acuity (NYSE: AYI) designs and manufactures light fixtures and building management systems used in various industries.

Why Does AYI Stand Out?

1. Offerings are mission-critical for businesses and result in a premier gross margin of 44.8%
2. Share repurchases over the last five years enabled its annual earnings per share growth of 18.1% to outpace its revenue gains
3. Stellar returns on capital showcase management’s ability to surface highly profitable business ventures

Acuity Brands’s stock price of $295.02 implies a valuation ratio of 14.9x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.

EPAM (EPAM)

Trailing 12-Month Free Cash Flow Margin: 11.2%

Founded in 1993 during the early days of offshore software development, EPAM Systems (NYSE: EPAM) provides digital engineering, cloud, and AI transformation services to help global enterprises and startups modernize their technology systems and create digital products.

Why Could EPAM Be a Winner?

1. Market share has increased this cycle as its 15.5% annual revenue growth over the last five years was exceptional
2. Earnings per share grew by 12.7% annually over the last five years and easily exceeded the peer group average
3. Industry-leading 24% return on capital demonstrates management’s skill in finding high-return investments

At $139.49 per share, EPAM trades at 11.1x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.

But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating 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 Kadant (+351% five-year return). Find your next big winner with StockStory today.