Had Jerry Maguire been an investor instead of a fictional sports agent, he might have become famous for yelling, "Show me the cash flow!"

Earnings come and go, and the green-eyeshade types can legally manipulate them to mask a company's true operations. Yet its ability to generate cash -- what comes in the register and goes out the door -- remains the preeminent indicator of a company's worth. In short, cash is king.

Below, we'll look at companies that have proved themselves to be prodigious generators of free cash flow -- the amount of money a company has left over that it could potentially pay to its investors. We'll find companies that have generated compounded FCF growth rates exceeding 25% annually over the past five years, and then we'll pair them with the opinions of the more than 135,000 members of the Motley Fool CAPS investor-intelligence community, to see which ones might have the best chances of outperforming the market.


Leveraged FCF 5-Year CAGR

CAPS Rating
(Out of 5)

Arch Coal (NYSE:ACI)






Mosaic (NYSE:MOS)



Walter Energy (NYSE:WLT)



XL Capital (NYSE:XL)



Sources: Capital IQ, a division of Standard & Poor's; Motley Fool CAPS.
CAGR = compounded annual growth rate.

Generating copious amounts of cash doesn't make a company an automatic buy. But having looked at Enron's cash flows instead of its earnings would have saved many investors a lot of grief. Warren Buffett understands that the value of a company today is calculated by its discounted future cash flows, so use this list as a jumping-off point to dig deeper into the piles of cash.

The evolution of the seller on eBay has probably accounted for much of the online auction house's revenue decline. With alternatives from Amazon.com (NASDAQ:AMZN) to Craigslist, sellers have a plethora of options available, and it doesn't help that eBay has made some irksome policy changes that have riled up its Power Seller base.

Yet the top auction site -- and it remains atop the field, whatever its shortcomings -- is moving to implement changes that should help placate many of its critics. For example, the latest initiative is to give top-rated sellers a 20% discount on their final value fees, as well as higher placement in the search process. eBay is mollifying investors, too, as it expects to spin off its fast-growing VoIP service, Skype.

CAPS member 91bvj believes eBay remains a solid investment: "It'll never be the fast growth stock it once was, but it still has a large moat to help stave off competition. With plenty of cash on hand and increasing Free Cash Flow ... I see EBAY as a value play."

Fertilizer giant Mosaic is another company at the top of the heap that did what it could to aggravate its client base. As a member of the potash cartel Canpotex, it and fellow members PotashCorp (NYSE:POT) and Agrium curtailed production in the face of flagging demand in an effort to prop up exorbitant prices. Two of Mosaic's competitors, Silivinit and K+S, recently agreed to sell potash to India at $460 a ton, much lower than the $700 price tag that was agreed to last year -- and Canpotex quickly followed suit.

The lower demand and production levels were evident in the recent earnings reports of fertilizer producers. Earnings reports came in sharply lower on drastically lower revenue, and many companies offered up weak forecasts for the year. The latest pricing reset, however, might signal a resurgence of demand that could markedly change Mosaic's prospects.

Last month, CAPS member WhiskeyGirl saw several driving factors behind Mosaic:

I'm convinced by the articles on increasing global population combined with decreasing arable land, water shortages etc. Also, in Asia, with increasing prosperity (once the economy picks back up), there is increased demand for better food and more choice. I believe an increasing middle class will create more food demand and fertilizers will help increase the yield per acre.

Follow the money
While these stocks have left a trail of dollars, it pays to start your own research on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made -- all from a stock's CAPS page. Head over to the completely free CAPS service, and have your say about these or any other stocks that you think will continue rolling in the dough.

Amazon.com and eBay are Motley Fool Stock Advisor picks. eBay is also an Inside Value selection. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Rich Duprey has no financial position in any of the stocks mentioned in this article. You can see his holdings. The Motley Fool has a disclosure policy.