3 Cash Flow Stocks Worth Watching In Enterprise Software

With inflation trends mixed, bond yields moving in different directions across regions, and energy prices influenced by supply tensions, investors are paying closer attention to what really underpins a stock: its cash generation. The Undervalued Stocks Based On Cash Flows screener focuses on companies where discounted cash flow estimates from SWS suggest the share price does not fully reflect their cash flow potential. For readers looking for ideas grounded in fundamentals rather than headlines, this article highlights 3 stocks from that screener and explains why their cash flow profiles may appeal to value oriented investors right now.

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TTM Technologies (TTMI)

Overview: TTM Technologies is a US based electronics manufacturer that builds high end printed circuit boards, RF components, and complete mission systems for customers in aerospace and defense, data centers, automotive, medical, industrial, and networking markets.

Operations: TTM generates most of its roughly US$3.1b in annual revenue from Commercial customers at about US$1.7b and Aerospace & Defense at about US$1.3b, with sales concentrated in the United States at about US$1.6b and other international markets contributing about US$1.2b.

Market Cap: US$14.9b

Investors watching cash generation may find TTM Technologies worth a closer look as it sits at the crossroads of AI data center buildouts and long term US and NATO defense spending, backed by an A&D backlog of US$1.46b and new Ultra HDI and RF capacity in the US and Malaysia. Recent earnings growth, margin improvement and new credit facilities indicate the company has room to fund expansions and acquisitions. However, there are ongoing questions around higher cost US plants, customer concentration, and exposure to US China tensions. The way those risks are managed, alongside the company’s focus on higher value engineered solutions and demand in defense and AI infrastructure, appears central to the investment case investors are currently debating.

TTM Technologies’ cash fueled expansion into defense and AI infrastructure looks like only half the story right now, especially given its A&D backlog and new capacity. To see how those projects, margins and financing terms really fit together, review the analysis report for TTM Technologies

Cellebrite DI (CLBT)

Overview: Cellebrite DI provides software for law enforcement agencies, governments and corporations to collect, decrypt, analyze and manage digital evidence from phones, computers, cloud services and other devices when carrying out legally sanctioned investigations into crimes such as child exploitation, fraud, terrorism and financial crime.

Operations: Cellebrite generates about US$496.4m in revenue from Internet Software & Services, reflecting its focus on subscription based digital forensics and investigation platforms.

Market Cap: US$3.9b

Cellebrite DI operates at the intersection of rising digital crime, growing data volumes and stricter privacy rules. This combination is encouraging agencies to adopt its SaaS investigation tools, FedRAMP High certified government cloud and AI offerings such as Genesis and Pathfinder. A high share of recurring subscription revenue and a share price below Simply Wall St’s cash flow based fair value estimate make the stock a point of interest for investors focused on fundamentals. At the same time, reliance on US federal contracts, a relatively high P/E multiple and funding that leans on external borrowing mean that execution on international, private sector and AI related expansion will be important in assessing the current valuation.

Cellebrite DI’s recurring SaaS revenue and cash flow focus could be masking a sharper story around contracts, AI tools and valuation. Get the full picture in the 3 key rewards and 1 important warning sign

Everpure (P)

Overview: Everpure is a US based data storage company that sells all flash arrays, unstructured data systems and subscription software that help enterprises store, protect and move data across on premises and public cloud environments, including AI and Kubernetes workloads.

Operations: Everpure generates about US$3.94b in revenue from Computer Storage Devices, with roughly US$2.67b from the United States and US$1.26b from the rest of the world.

Market Cap: US$23.52b

Everpure attracts attention because it sits where AI infrastructure, data growth and cash generation intersect, with all flash hardware, Purity software and Evergreen subscriptions tied to enterprise and AI workloads. Earnings grew 77.4% over the past year and net margins improved to 5.7%. Simply Wall St’s cash flow model suggests the stock trades below estimated fair value and analyst targets remain more than 20% above the current price. At the same time, a very high P/E multiple, significant insider selling and reliance on external borrowing add risk if growth or AI adoption disappoints. Recent news around AI focused product launches and an activist stake from Jana Partners indicates that the story may still be evolving for Everpure investors.

Everpure’s earnings jump, AI tied products and activist interest suggest the story could be accelerating, but the high P/E, insider selling and borrowing raise sharper questions that the analysis report for Everpure explores in more detail.

The three stocks in this article are only a starting point, with the full Undervalued Stocks Based On Cash Flows screener uncovering 729 more companies where discounted cash flow estimates suggest similarly compelling stories. If you want to identify the highest conviction setups around cash generation, valuation gaps and real world catalysts, use Simply Wall St to analyze and filter the full Undervalued Stocks Based On Cash Flows screener.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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