Amazon, Airbnb, and Activision Blizzard are among them! Analysts: Focus on these 10 cash-rich US stocks.

Jefferies said that cash is king now, and it is important to focus on US stocks with sufficient cash.

Bullish on US stocks with abundant cash

Desh Peramunetilleke, global micro-strategy director at Jefferies, said that companies with cash are an overlooked "sweet spot."

He said: "Interest rates and yields in the United States and Europe are rising sharply, and interest income and interest expenses will rise, so cash is king."

"After cash rates on the balance sheet have been zero for most of the past 10 years, cash on the balance sheet is now receiving healthy returns. In fact, the proportion of cash to total assets is the best long and short factor in the global stock market this year, led by US stocks.

Peramunetilleke said that companies with abundant cash on their balance sheets also performed much better in the first quarter, while companies with higher leverage performed the worst and may be hit by rising debt costs.

Looking at various regions, the analyst found that the United States and Europe have the highest leverage and the least cash on their balance sheets.

"However, considering the significant difference in short-term debt (24% in Europe and only 11% in the United States), it is expected that the net interest cost of MSCI US will decrease by about 9%, while the net interest cost of developed market Europe is expected to increase by 8%," he said.

10 US stocks with abundant cash

From an industry perspective, consumer services, retail, media, utilities, automobiles, software, and semiconductor companies are expected to benefit the most from higher interest income, while utilities, automobiles, home and personal care companies will be most affected by rising debt costs.

Peramunetilleke provided a list of US companies with "abundant cash" that will benefit from higher cash rates.

Top ten: Activision Blizzard, ServiceNow, General Electric, Amazon, Fortinet, Airbnb, VMWare, Microsoft, and Costco.

He also listed a list of companies to avoid. That is, companies with less cash and longer maturity of short-term debt may face higher interest expenses due to rising debt costs.

The top ten include: Hewlett Packard Enterprise, Stanley Black & Decker, Evergy EVRG, McCormick, NiSource NI, Sempra SRE, Celanese CE, Ameren AEE, Eversource Energy ES, and DTE Energy DTE.