"Ask and you shall receive..." -- John 16:24

Well, I'll be darned. I honestly didn't think it would be that easy. Penning my Foolish Forecast for the earnings report 3Com (NASDAQ:COMS) released yesterday evening, I chided management for overreaching in its enthusiasm to report a GAAP profit at long last. I suggested that instead of arguing that it had reached "profitability lite" -- pro forma profits -- the firm should instead bolster its case with a cash flow statement reflecting the considerable cash profit the firm has generated.

Wouldn't you know it? 3Com did just that last night, highlighting cash from operations in its sub-headlines and including a full-fledged cash flow statement with its release. Over the past year, it's generated free cash flow of $137.2 million, a full 99% better than last year's $68.8 million.

So why is the stock down 8%?
Thank goodness it released that cash flow info -- from a pure GAAP perspective, its other news appears to have sorely disappointed the market. Helped by 3Com's purchase of the remainder of its H3C subsidiary, which enables better access to local Chinese customers such as China Life Insurance (NYSE:LFC) and the Agriculture Bank of China, sales grew to $310.9 million for the quarter. Unfortunately, while that was a 22% improvement over last year's fiscal Q4, it was also a bit short of Wall Street's hopes. As expected, 3Com reported pro forma profitability, but its GAAP net loss ran to $0.17 per share -- a more than threefold increase year over year.

Foolish takeaway
Mr. Market may not be thrilled with 3Com today, but this Fool feels more optimistic. The company took a big step toward fully disclosing its finances to shareholders by promptly publishing its cash flow statement, and it deserves kudos for that. Valuation-wise, the stock may not be a screaming buy, but at 12 times trailing free cash flow, and with analysts expecting long-term growth of 10% per year, it's not unreasonably priced.

Now fully in control of H3C, its profit driver of the past few years, I expect 3Com to outperform those growth estimates in the near future. If it succeeds, and maintains the free cash flow generation we saw last year, this stock could begin to look like a real bargain at today's newly discounted price.

What did we expect out of 3Com last quarter, and what did we get? Find out in:

Fool contributor Rich Smith does not own shares of any company named above. The Fool has a disclosure policy.