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 that metric to mask a company's true operations. A company's ability to generate cash -- what comes in the register and goes out the door -- remains the preeminent indicator of its worth. In short, cash is king.

Below, we'll look at companies that have proved 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 five)

Air Transport Services Group (NASDAQ:ATSG)



Hewlett-Packard (NYSE:HPQ)






Powerwave Technologies (NASDAQ:PWAV)



Tessera Technologies (NASDAQ:TSRA)



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 these companies' piles of cash.

Jim Cramer has likened the sea change the mobile Internet will create to a tidal wave that sweeps away any tech company that's not a part of it. Cramer has created a preferred list of stocks that he believes will be an integral part of a movement that will fundamentally alter the landscape as much as the establishment of the original Internet.

But CAPS member Garyestein doesn't see quite the same tectonic shifts occurring. He also thinks the Mad Money host missed several key players in the mobile Internet's evolution, including Hewlett-Packard, Dell (NASDAQ:DELL), and even Lenovo:

His thesis is that the mobile internet while be as big a game changer as the original internet was. Being a CTO I do not think it will be that big a movement but it will provide enough growth for his index to work just not be the huge bust out he thinks it will be. What your looking at is replacing every cell phone and laptop with a device that can connect to the internet at broadband speeds form just about anywhere in the US. The only problem I with his choice is that he left out HP and DELL and Lenovo the big laptop makers they will have a play and I am including them in my version of the index.

The check is in the mail
Discounting Netflix as an investment because of potential alternative movie delivery technologies or the rise of competitors would probably be as shortsighted as the movie studios' own efforts to squeeze the online rental merchant.

The future will undoubtedly find new ways for viewers to watch movies. Even today, you can get free or very cheap streams online. Heck, you can even watch movies for no extra charge on Netflix's own site. But the death of the DVD is not imminent, and CEO Reed Hastings expects to send out red envelopes for decades. Coinstar (NASDAQ:CSTR) has developed into a movie star in its own right with the ubiquity of its Redbox $1-a-night vending machines. But even that ought to be considered a supplement to a Netflix subscription, rather than a replacement for it.

Yet those competing visions separate Netflix bulls and bears on CAPS. OldEnglish thinks Neflix falls in the wrong spot between two generations: "No one under 30 is going to be using Netflix because they can get it for free or at the Redbox. No one over 30 is going to use Netflix because their new Walmart job doesn't pay enough; Nothing like their previous house flipping career."

Conversely, torufii thinks Netflix will innovate to meet customer needs: "Innovation in a business model is a card that is worse while buying. It is likely if they were smart enough to shift gears into a different strategy of distribution, they will be thinking of other options as well."

Follow the money
What's your view? 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 rolling in the dough?

Netflix is a Motley Fool Stock Advisor pick. Dell is a Motley Fool Inside Value 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. The Motley Fool has a disclosure policy.