Operating cash flow (OCF) provides a terrific insight into the health of a stock's underlying business, showing the amount of cash generated before spending on capital expenditures (capex).

This figure is instrumental when looking at younger companies still in their growth stage, because many high-growth stocks reinvest most of the cash generated back into the business. This often leaves little (or negative) free cash flow (FCF) and net income to be used in price-to-free-cash-flow or price-to-earnings ratios -- making the price-to-operating-cash-flow (P/OCF) ratio handy for valuations.

Today we will look at Airbnb (ABNB -2.47%), Trex (TREX 3.52%), and DigitalOcean (DOCN 5.43%), whose low respective P/OCFs of 21, 13, and 20 make them attractively priced. Let's take a deeper look at each.

1. Airbnb

Generating $3.2 billion in OCF over the last year, Airbnb and its platform for stays and experiences is a rare recent initial public offering (IPO) that has managed to create mountains of cash flows right away. Posting a trailing-12-month OCF figure that has only grown each quarter since going public in December 2020, Airbnb is an outstanding growth stock for cash-flow-focused investors.

However, despite this steady OCF growth and Airbnb more than doubling its sales since the start of 2021, its stock price has gradually declined since its IPO. 

Down nearly 40% in 2022 alone, Airbnb now trades at an alluring 21 times OCF -- a far cry from the 60 multiple it stood at in the start the year.

This low P/OCF figure is well below the S&P 500 Index's median of 27 and looks even more impressive considering the company's incredible growth. Booking nearly 100 million nights and experiences in the third quarter, Airbnb grew sales by 36% (minus foreign exchange impacts) and OCF by 81% year over year. 

In addition to delivering its most profitable quarter ever, the company saw 20% of its total nights booked come from stays of over 28 days. This stat hints at Airbnb's continued success within the "work from anywhere" movement's rise to prominence. 

Along with these long-term stays, the company recently announced an agreement with a handful of apartment providers to allow tenants to sublet their rooms on Airbnb's platform. In what looks like an "if you can't beat them, join them" move, these apartment complexes partnered with Airbnb rather than continuing to lose money from tenants subleasing their unused rooms under the table.

This partnership adds another wrinkle to the company's potential and highlights its growing number of use cases going forward. Thanks to Airbnb's growing OCF, cheap valuation, and intriguing growth potential, its stock looks like a fantastic deal at today's prices.

2. Trex

Generating $398 million of OCF over the last 12 months, environmentally friendly decking and railing manufacturer Trex has delivered stable results despite a challenging housing environment. As its distributors sold through inventory during the slowdown, Trex saw sales decline 44% during the third quarter compared to the prior year's quarter, yet still managed to post a positive OCF. 

Regardless of this cyclicality surrounding the company's operations, it has generated strong cash flows over the last decade.

Even as Trex decided to bolster its vertically integrated manufacturing capabilities by announcing a third production plant in Arkansas, it has mostly remained free-cash-flow positive despite this increased capex in recent years. However, with the first nine months of sales in 2022 only rising 2% compared to 2021's figures, the market has sold off the company's shares by a staggering 66% year to date.

This leaves Trex trading near a decade-low figure of 13 times OCF.

Nonetheless, with 38% of home improvement spending coming from the outdoor living category, Trex has positioned itself to bounce back once homeowner's financial health improves. While more expensive than traditional wood options, Trex's decking comprises 95% recycled wood fibers and polyethylene film and requires a payback period of just three years due to its minimal maintenance costs.

Thanks to its bargain valuation and the fact that only 25% of decking currently comes from eco-friendly composite options like Trex's, it looks like an eventual rebound is in store for this cyclically cheap stock.

3. DigitalOcean

Much like Shopify offers entrepreneurship empowerment to the masses, DigitalOcean looks to bring simplified cloud operations to these same businesses. Operating behind a hidden moat, DigitalOcean serves a valuable niche of entrepreneurial and start-up-sized companies that are too small for its massive hyperscale cloud peers to worry about today.

Through its simplified infrastructure and platform-as-a-service cloud offerings, the company aims to allow its customers to focus on creating great software and not be bogged down with tedious cloud issues. Offering support, tutorials, and a knowledge base of information on its cloud services, DigitalOcean can help and grow alongside its small customers in a way that would not be profitable for its larger peers to try.

Despite only being publicly traded since March 2021, the company is already generating a 36% OCF margin as of its most recent quarter -- most of which is reinvested into the business in the form of capex. 

Despite growing revenue by 37% year over year in Q3, DigitalOcean's share price has dropped over 60% in 2022.

Now trading at just 20 times OCF, it may be time to consider an investment in the company as its sales continue rapidly ascending.

Sporting an improving dollar-based net retention rate of 118%, DigitalOcean's existing customers are increasing their spending faster than ever, making its recent sell-off look even more tempting.