1 Cash-Producing Stock with Impressive Fundamentals and 2 That Underwhelm

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.

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 excels at turning cash into shareholder value and two that may face some trouble.

Two Stocks to Sell:

MYR Group (MYRG)

Trailing 12-Month Free Cash Flow Margin: 3.1%

Constructing electrical and phone lines in the American Midwest dating back to the 1890s, MYR Group MYRG is a specialty contractor in the electrical construction industry.

Why Should You Sell MYRG?

• Backlog has dropped by 2.4% on average over the past two years, suggesting it’s losing orders as competition picks up
• Performance over the past two years shows its incremental sales were much less profitable, as its earnings per share fell by 4.6% annually
• Eroding returns on capital suggest its historical profit centers are aging

At $175.62 per share, MYR Group trades at 24.3x forward P/E. If you’re considering MYRG for your portfolio, see our FREE research report to learn more.

TD SYNNEX (SNX)

Trailing 12-Month Free Cash Flow Margin: 1%

Serving as the crucial middleman in the technology supply chain, TD SYNNEX SNX is a global technology distributor that connects thousands of IT manufacturers with resellers, helping businesses access hardware, software, and technology solutions.

Why Are We Wary of SNX?

• Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
• Earnings per share fell by 1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
• Poor free cash flow margin of 1.2% for the last five years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends

TD SYNNEX is trading at $151.64 per share, or 12.1x forward P/E. Dive into our free research report to see why there are better opportunities than SNX.

One Stock to Buy:

Comfort Systems (FIX)

Trailing 12-Month Free Cash Flow Margin: 7.4%

Formed through the merger of 12 companies, Comfort Systems FIX provides mechanical and electrical contracting services.

Why Will FIX Outperform?

• Average backlog growth of 29.5% over the past two years shows it has a steady sales pipeline that will drive future orders
• Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
• Improving returns on capital reflect management’s ability to monetize investments

Comfort Systems’s stock price of $753.69 implies a valuation ratio of 37.8x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.

High-Quality Stocks for All Market Conditions

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. 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-small-cap company Exlservice (+354% five-year return).

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