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 proven themselves prodigious generators of free cash flow (FCF) -- 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 free cash flow growth rates exceeding 25% annually over the past five years, then 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 chance of outperforming the market.


Levered FCF
5-Year CAGR

CAPS Rating (Out of 5)

Ford (NYSE:F)



Foster Wheeler (NASDAQ:FWLT)



Gilead Sciences (NASDAQ:GILD)



Rite Aid (NYSE:RAD)



Titanium Metals (NYSE:TIE)



Source: 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.

Ford has come a long way since Henry Ford's apocryphal statement that consumers can have any color car they want so long as it's black. The carmaker has come even further in just the last few years when it looked as though it was headed for the scrap heap, and was a pitiful runner-up to GM and even Chrysler.

Today it remains the only one of the one-time Big Three carmakers not having gone through a government restructuring, and the company maintains that it is on track to return to profitability by 2011. It is implementing its "One Ford" plan that will have fewer vehicle platforms, but of higher volume from which several models can be built. It will also have at least half of its vehicles available globally though there will be cars exclusive to certain markets. In the game of automotive poker, Ford is going all in. CAPS member sempire is betting the carmaker won't need to bluff to win the pot.

In the near term it looks like Ford knows what's going on. Hopefully they will trim down their lines and offer a few vehicles per line, modern up their offerings, and give the consumers what they want (Like it took all these years to figure out people like European design, nice interiors and Japanese reliability).

If Ford can build some good looking, reliable cars I am sure they can get back some market share. Maybe introduce some Lincoln cars that are just not Ford cars with leather and a new grille.

A prescription for growth
Having to take a cocktail of drugs can make it difficult to maintain the proper therapy regimen when treating HIV. Gilead Sciences' Atripla is a one-pill-a-day treatment that has rocketed to the top of the prescription chain. A combination of Gilead's Truvada and Bristol-Myers Squibb's (NYSE:BMY) Sustiva, the antiretroviral Atripla is the most prescribed treatment for HIV, with 33% of all treated patients on the regimen. Sales jumped 60% year over year last quarter and were up 12% sequentially. Although some of that may have been due to inventory buildup, the prospects for further growth remain strong now that France granted reimbursement for Atripla in May.

Not content to rest on its laurels, Gilead is plunging ahead with new initiatives, such as a new combination HIV treatment being developed in tandem with Johnson & Johnson (NYSE:JNJ). In the interim, Atripla's popularity has CAPS member BGview seeing Gilead continuing to gain share.

As long as GILD's Atripla continues to be the lead choice of a single dose / single pill HIV treatment, it will gain market share as doctors put patients on this drug.

Recent study showing that the company's anti-HIV drugs can be used in Africa without constant lab test monitoring of patients should boost significantly its opportunities in developing markets.

Negatives can be competitors coming up with their own one pill / once-per-day HIV drugs or alternative therapies appearing. Those are still at least few years away.

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. Why not head over to the completely free CAPS service and let us hear what you've got to say about these or any other stocks that you think will continue to be rolling in the dough.

Titanium Metals is a Motley Fool Stock Advisor pick. Johnson & Johnson is a Motley Fool Income Investor selection. Try any of our Foolish newsletter services today, free for 30 days.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.